The EUR/USD pair has initially tried to rally during the day on Monday but rolled over at the 1.2350 region to reach towards the 1.23 handle. I think that the market is trying to build up enough momentum to go higher, but we are still forming the base of that the market needs to create so buyers can have their way. Because of this, I think that buyers are starting to come in and pick up a bit of value. I would anticipate that the 1.2275 level should be supportive based upon what we have seen on the hourly chart, and I am willing to buy this pair slowly and build up along the way. I think that the market will go looking towards the 1.25 level longer term as well, as it was the scene of the most recent pullback.
You can see that the 50 EMA is now below prices and turning up on the hourly chart. This of course is a good sign for short-term traders, and although I think it will take several attempts to finally clear the 1.25 level, the longer-term charts still suggest that we could go as high as 1.32 based upon the breaking of the top of the bullish flag on the weekly chart. The measurement suggesting at least 1.32, and I think at this point we are probably going to see a lot of negativity around the US dollar, which by default will push this pair higher.
Written by FX Empire