Euro Attempts to Recover for the Week

The Euro rallied significantly during the trading week to reach towards the 1.1150 level, but then pulled back to show signs of hesitation. At this point, I think that the Euro is more likely than not to continue seeing selling pressure, but I do not necessarily think that we are going to meltdown. The 1.12 level offers a certain amount of resistance as a ceiling, so I think that is probably about as positive as this market could go. The markets will continue to see a lot of choppy volatility, but quite frankly that is not a huge surprise.

EUR/USD Video 21.03.22

On the downside, we could go looking towards the 1.08 level, an area that has been important multiple times in the past. Breaking down below there would open up the possibility of a strong sell-off, but I do not think we are at that point yet. The European Union continues to suffer at the hands of weak economic performance, and of course, the fact that the Federal Reserve is so much stronger with its monetary policy than the European Central Bank is.

The market could turn around, but that is only if we see some type of change coming out of the Federal Reserve. I do not see that happening right now, and in fact, there are some governors out there talking about how the Fed needs to get even tighter. I believe at this point in time any rally will more than likely be looked at with suspicion, and probably faded. If we can break above the 1.12 handle, then we could go looking to higher levels but that is the very first barrier that we have to overcome for me to even think about buying.

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