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Christopher Lewis
EUR/USD daily chart, December 17, 2018

The Euro broke down during the trading session on Friday, reaching below the 1.13 level. We have broken below the bottom of a symmetrical triangle, so this does suggest that perhaps we are going to go lower eventually. At this point, it’s likely that short-term rallies will continue to be faded, as the situation between the EU and the UK continues to deteriorate. Ultimately, I believe that the market may go looking towards 1.11 level between now and the end of the year. I believe rallies will be faded, as we continue to see a lot of concerns as a “hard Brexit” will not only damage the United Kingdom, but also damage the European Union and its fragile economy.

EUR/USD Video 17.12.18

I think at this point, we are probably not looking at major moves, but just more of a general grind lower. I don’t like trading this market for more than short-term trades, and that is especially true this time of year. I do think that we are still essentially range bound, but with more of a downward slant than anything else. If we did break above the 1.15 handle, that would change everything but right now it looks very unlikely to happen. I think there is a massive amount of support underneath though, as the 61.8% Fibonacci retracement level, somewhere near the 1.11 handle, means that there is probably limited downside although it certainly seems to be where the attitude of the market leans towards.

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