Euro Bounces From Big Figure

The Euro has rallied a bit during the course of the trading session on Friday to see a little bit of stabilization near the 1.12 level. The 1.12 level of course is an area that would attract a lot of interest, as it is a large, round, psychologically significant figure, and as a result if we can break above there, then we could go looking towards the 50 day EMA.

EUR/USD Video 28.02.22

If you have been watching my analysis here at FX Empire, I told you that we could be looking at the possibility of the market trying to find some type of consolidation range between roughly 1.12 on the bottom and 1.15 on the top. Because of this, a little bit of a rally may come into focus, but I am still looking for shorting this market on signs of exhaustion after rallies. Quite frankly, with the Federal Reserve looking to tighten monetary policy, then it makes quite a bit of sense that the US dollar will continue to outdo the Euro overall. Having said that, we are a little bit oversold at this point, so a little bit of a bounce makes quite a bit of sense in the short term.

That being said, keep in mind that we have to worry about the overall risk appetite of markets, because if we do get another “risk off event”, it is likely that the US dollar will strengthen yet again. This is especially true if it comes out of Ukraine, as it is on the steps of the European Union.

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