Christopher Lewis
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EUR/USD daily chart, April 04, 2019

The Euro has bounced nicely from the 1.12 level during the trading session on Wednesday, as we continue to see the longer-term consolidation area hold. The 1.12 level is the bottom of this major area, with the 1.15 level above offering massive resistance. As we have reached an oversold condition, it makes sense that the buyers would of course be interested. However, there is going to be a lot of noise between here and the top of that range as you would expect. After all, the selling has been rather brutal as of late.

Euro to Dollar Forecast Video 04.04.19

Looking at the chart, I suspect that we are going to see trouble at large, round, psychologically significant figures. Overall though, this is a market that favors short-term trading, but as we are at the bottom of the range it most certainly has more of a risk to the upside then down. After all, the 1.12 level is massive support based upon the previous move higher and the fact that it is the 61.8% Fibonacci retracement level. Beyond that, it is also an area of extreme resistance previously, so obviously there is a bit of “market memory” to be seen here as well.

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If we did break down below the 1.12 level, obviously that would be a major situation. This is especially true if we could crack about 100 points lower, which could open the door to the 1.10 level and beyond. That being said, I think we are starting to see value hunters come back in as the Federal Reserve is keeping interest rates low.

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