The EUR/USD pair has gone sideways during the session on Wednesday as we continue to consolidate just above the 1.17 handle. If we can break above the 1.1765 handle, I think that the market will continue to grind higher. While I believe in the uptrend longer-term, the reality is that the uptrend hasn’t pulled back enough for me to be completely comfortable. We have seen 2 impulsive moves to the downside as of late, and I think that we could get more. If we break down below the 1.1680 level, then the market will probably drop down to the 1.16 handle.
I believe that the market will continue to see a significant amount of volatility, as it appears that the market is suddenly going to grind sideways, and then stair step either higher or lower as traders suddenly make the same move. We are in one of the most ill liquid times of the year, as most large trading desks have senior traders away at holiday. Because of this, the market could be a bit stagnant.