Euro Rallies Slightly on Tuesday

The Euro has rallied a bit to show signs of strength as we continue to see a lot of choppy behavior. The market continues to be very noisy, and we are waiting for the FOMC decision this week to move the US dollar longer term. That being said, the market is more than likely going to continue to see volatility, but I think we will continue to see a bit of US dollar strength.

EUR/USD Video 16.03.22

If the Federal Reserve ends up being a bit more dovish than the previous, it is possible that the market would start selling the US dollar for the short term, but it is more than likely only going to be a matter of time before the longer-term downtrend continues. After all, there are a whole host of problems in the European Union, not the least of which was the horrific ZEW number that just came out and Germany that was anticipated at being +5 but was announced at -39.

I believe that the 1.12 level above is going to continue to be significant resistance, especially as the 50 Day EMA is starting to curl underneath there. The 1.08 level underneath has been supportive, so I think a breakdown below there could really open up the floodgates to the downside. Nonetheless, this market will continue to be choppy so therefore I think you probably need to be a bit cautious with your position size. The selling of rallies will more likely than not continue to be the case going forward.

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