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Christopher Lewis
EUR/USD

The Euro initially fell during the trading session on Wednesday to reach down towards the 1.0950 level before turning back around. By doing so, the market showed resiliency and it looks as if it is trying to break out for a bigger move. Was worth noting is that we have formed a couple of hammers on the monthly chart, and that suggests that we are going to see an attempt to break out for a longer-term trend change.

The Euro got a bit of a boost during the day due to the €750 billion recovery bill going through the European Commission, showing signs that perhaps the European Union is starting to get things together. That being said, it is also worth noting that the 200 day EMA is starting to cause a bit of a reaction so I think one of two things are about to happen…

EUR/USD Video 28.05.20

We will either break above the 1.11 handle, and continue to go much higher for the longer-term, or we are simply trying to widen the range in general. This is a messy pair to say the least, and one that I absolutely hate trading. This is because there are very few trends other than to grind lower over the course of the last several years, but grinding being the main characteristic. If the market closes below the 1.1080 level, then it is likely that we pull right back into the previous consolidation area. It is going to be one of these two scenarios, and it could take several days to make the decision, as it is typical of this pair which is the realm of high-frequency traders.

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

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