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Christopher Lewis
EUR/USD

The Euro has rallied a bit during the trading session throughout European and Asian hours but has found the 1.12 level as a bit of a barrier to get beyond. The candlestick looks like it is trying to show some type of exhaustion, and therefore I think it is only a matter of time before we come back into the realm of reality, as the European Union has a whole plethora of issues out there.

EUR/USD Video 04.06.20

At this point, I believe that the market at the very least needs to come back into a bit of a “reversion to the mean.” Overall, the market is likely to see a lot of volatility which is very typical for this pair, and at this point this is yet another major swing within a relatively tight area. To the downside, if we were to break down below the 1.10 level it would send this market much lower. On the other hand, if the market breaks above the 1.1250 level, then the 1.15 level would be a target.

At this point, I believe that the market simply has gotten far too ahead of itself, so a short-term selling opportunity is going to present itself. If we take off to the upside from here, then it most certainly will become a “blow off top”, and I expect a ton of selling to enter the equation near the 1.15 level above. Markets cannot go in one direction forever, and clearly some sense of gravity needs to come back into the situation.

For a look at all of today’s economic events, check out our economic calendar.

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