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Christopher Lewis

The Euro rallied significantly during the week but gave up quite a bit of the gains once we hit the 200 week EMA again. From there, the market has struggled to keep up, but then again you could also say it has struggled to break down. If that is going to be the case, eventually something has to give and that would be signified by a weekly close above the 200 week EMA or perhaps even the 1.14 level.

One thing is for sure, the market is trying everything it can to break out from here so this is going to be one of those times where the market will see one of two things: it will either finally break out and probably rather violently, or we will run out of momentum and simply fall apart. I get this feeling it is one or the other, and nothing in between.

EUR/USD Video 13.07.20

To the downside, if we were to break down below the 1.1180 level, then we are likely to go looking towards the 1.10 region. The biggest thing propping this pair up right now is the Federal Reserve dumping US dollars into the system, and bits and pieces of optimism coming out of the European Union due to a new pandemic find. Ultimately though, I think we probably need to see some type of impulsive candlestick to the upside to get overly excited. Otherwise, this continues to be a very choppy and short-term type of trading environment.

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

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