- The Euro has rallied pretty significantly during the early part of the trading session on Tuesday as we continue to see a lot of noisy behavior.
- All things being equal, the 1.16 level is an area that I think continues to be a bit of a magnet for price and right now it's offering significant support.
- It's also worth noting that the 50 day EMA sits below there and it's likely that it will offer support as well.
Ultimately, the market breaking down below the 50 day EMA opens up the possibility of a move down to the 1.14 level, which was the latest swing low. If we were to break to the upside, the 1.18 level would be a potential barrier as it was a double top, and it has caused quite a bit of noise. If we can break above there, then 1.19 and then eventually 1.20 will be your target.
CPI Numbers on Tuesday
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The CPI numbers came out basically as expected during the trading session on Tuesday and they were about where people expected them to be. So, we've seen the Euro bounce a little bit against the US dollar as the greenback has given back some of its fight, but whether or not that last remains to be seen, I think at this point, you're just looking at a market that's trying to find any type of momentum or real interest in the market because this is one of the quietest times of the year.
A lot of bigger traders are just away at holiday. So, it's hard to get overly aggressive. That being said, this is a market that I watch very closely because it can give you a bit of a “heads up” as to how the U S dollar might move against other currencies.
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