- The Euro plunged during the trading session on Friday after the jobs number in America came out much hotter than anticipated.
- That being said, this is a market that slicing through the 1.10 level actually starts to make the argument that we just formed a major M pattern.
- This is a double top that has now broken to a fresh new low.
- This is a situation where the sellers are getting more aggressive, and therefore it is likely that the market will continue to feed itself.
So technically speaking, we are in the midst of potentially changing trends. At this point, the 200-day EMA sits right around the 1.09 level, and if we break down below there, we could see a move down to the 1.08 level. Short-term rallies could be faced with a bit of a headache in the form of 1.10. And then the 50-day EMA indicator underneath there.
Top Regulated Brokers
On a move higher
Breaking above all of that could open up a move back to the 1.12 level, but keep in mind this is a pair that is trying to sort out what's going to happen with the two central banks as the Europeans seem very balanced at the moment, perhaps even likely to keep interest rates lower due to the fact that interest rates have dropped just a bit below the 2% target.
On the other hand, the Federal Reserve is seeing a robust jobs situation. If that's going to be the case, we may have to keep interest rates higher in America. And that would drive this pair down. Either way, to me, it looks like we're going back and forth between big handles. I think that continues to be the case, but clearly the sellers have made their presence known this week as the dollar continues to attract attention in general, due to not only the strength of the United States economy, but also the concerns about all of the geopolitical issues around the world.
Ready to trade our daily EUR/USD Forex analysis? We’ve made a list of the best forex demo accounts worth trading with.