The EUR/USD pair fell during the bulk of the session on Tuesday, and even made a fresh, new low. Because of this, the market could continue lower, and aim for the next support level that I see being significant, the 1.33 handle. This is based upon longer-term charts, and I believe that the market is in fact aiming for that area overall. Yes, I can see that the market is oversold at this point, but ultimately we should continue to see the US dollar gained against the Euro, and if we managed to break below the 1.33 handle that would in fact be a massively bearish signal.

Because of this, I am still bearish in this market but would prefer to sell rallies when they appear. Obviously, the bounce that we got during the Friday trading session due to the nonfarm payroll numbers being slightly less than anticipated was a nice selling opportunity. I believe that that’s how this market will trade going forward, simply offering selling opportunities.

Don’t fight the trend.

This trend is so strong that although it is oversold, I would certainly not try to fight it. A rally at this point in time should bring sellers, and I believe that the perfect place to sell this pair from is actually the 1.35 handle. However, you could make a fairly significant argument against this market trying that level anytime soon. Because of this, you may just have to “take what you are given”, and sell down here.

I suspect that the European Central Bank will have to loosen its monetary policy sometime over the next several months, and this could be the market preparing for that. The stock indices in Europe don’t look much better, and as a result I feel that money is just leaving the European Union in general. With that, I am bullish the US dollar and I believe that the US dollar in general is getting a bit of a Renaissance at the moment as trader step back into it after shunning it for so long.


Related Articles
  1. Financial Advisors

    Tips on Passing the CFA Level I on Your First Attempt

    Obtain valuable tips and helpful study instructions that can help you pass the Level 1 Chartered Financial Analyst exam on your first attempt.
  2. Professionals

    The Best Financial Modeling Courses for Investment Bankers

    Obtain information, both general and comparative, about the best available financial modeling courses for individuals pursuing a career in investment banking.
  3. Stock Analysis

    These are Twitter's 4 Biggest Bets for Next Year

    Looks at Twitter's plans for 2016 under CEO Jack Dorsey, who has returned to lead the company he founded seven years after he was replaced.
  4. Investing Basics

    Why Interest Rates Affect Everyone

    Learn why interest rates are one of the most important economic variables and how every individual and business is affected by rate changes.
  5. Entrepreneurship

    Top 5 Billionaires Living In Dallas

    Learn who the richest of the rich are in a city known for creating some of the world's wealthiest people, and read how they amassed their vast fortunes.
  6. Credit & Loans

    Best 3 Online Auto Loan Calculators that Include Tax

    Learn where you can find the best auto loan calculators online that include sales tax, and understand the different features these calculators offer.
  7. Taxes

    Tax Breaks For Volunteering

    Your volunteer ventures could earn you some welcome tax deductions, along with the satisfaction of helping others.
  8. Retirement

    5 Secrets You Didn’t Know About Traditional IRAs

    A traditional IRA gives you complete control over your contributions, and offers a nice complement to an employer-provided savings plan.
  9. Retirement

    Is Working Longer A Viable Retirement Plan?

    Fully funding someone’s life for three decades without work is tricky. The result is retirement has become, for many, a 30-year adventure.
  10. Retirement

    Don’t Retire Early, Change Careers Instead

    Though dreamed of by many, for most, early retirement is not a viable option. Instead, consider a midlife career change.
  1. Are secured personal loans better than unsecured loans?

    Secured loans are better for the borrower than unsecured loans because the loan terms are more agreeable. Often, the interest ... Read Full Answer >>
  2. Is Israel a developed country?

    Israel is considered a developed country, although it has substantial poverty and large income gaps. The International Monetary ... Read Full Answer >>
  3. Can personal loans be included in bankruptcy?

    Personal loans from friends, family and employers fall under common categories of debt that can be discharged in the case ... Read Full Answer >>
  4. How many free credit reports can you get per year?

    Individuals with valid Social Security numbers are permitted to receive up to three credit reports every 12 months rather ... Read Full Answer >>
  5. Is the Wall Street Journal considered to be a conservative publisher?

    The Wall Street Journal is controlled by Rupert Murdoch via Dow Jones Publications, which in turn is owned by Murdoch's News ... Read Full Answer >>
  6. Is Spain a developed country?

    Spain is a developed country. Nearly all organizations that analyze development status classify it as such. Spain has a strong ... Read Full Answer >>

You May Also Like

Trading Center