Euro drift lower during the trading session on Wednesday

The EUR/USD pair has broken down a bit during the trading session on Wednesday, reaching towards the 1.21 level underneath. That’s an area that is massive in its importance, as it was the scene of a major breakout recently. By bouncing from that area, the market should continue the uptrend, but quite frankly we continue to see relentless pressure to the downside due to the 10-year treasury yields arising in America, putting upward pressure on the greenback.

The ECB is suggesting that perhaps significant tightening of money may be a bit farther ahead than people thought, so I think that the market will continue to punish the Euro in general, but I think this is more of the dollar move than anything else, as we have seen the greenback strengthen against almost everything. Ultimately, the market is likely to continue seeing a lot of volatility, but I think it’s good to be difficult for the market to make a larger move until we either break down below the 1.21 handle, or we start to see US dollar weakness. Short-term selling rallies probably continues to be the way the market asked, as we continue to see a bit of downward pressure overall. I recognize that the greenback is highly correlated to the 10-year yields right now, and as they rise above 3%, that has people concerned about the overall desire to own risk assets, which this pair tends to rally right along with. I think choppiness is the only thing you can count on, but it certainly looks as if it has a short-term downward pressure buildup.

Euro to Dollar Forecast Video 26.04.18