The EUR/USD pair fell during the course of the day on Wednesday as the GDP numbers came a much stronger than anticipated in the United States. On top of that, the FMOC released a statement suggesting that although quantitative easing is been tapered yet again, the reality is that the market still shows a lot of slack in it, as employment seems a bit depressed. This drove the value of the US dollar higher, and then we had a turnaround later in the day.

The resulting candle is a hammer, which of course is one of the more supportive and bullish candles and you will see. The fact that it appeared at the 1.34 level adds more credence to the “round number theory”, as big money could come back into play. Quite frankly though, I feel that with nonfarm payroll coming out tomorrow, this could simply be a bit of a “dead cat bounce.”

Looking to sell rallies.

I personally am looking to sell rallies in this pair, and think that the 1.35 level is going to be massively resistant. To be honest, I would be really surprised to see this market even challenge that level before the jobs numbers come out of the US. With that being the case, I feel that this is one of those times where a lot of gullible traders will probably come in and try to scalp the market, only to lose money. I know this, because when I was a new trader, I would’ve looked at this as a nice trading opportunity as opposed to a time to step back and let the market come to levels that I find value in.

Ultimately, I think that we still go down to the real support at the 1.33 handle, although a bounce between here and there certainly is expected. This should have sellers stepping in and taking a value play by a cheaper US dollar, recognizing that the longer-term trend certainly seems negative as we are fallen so swiftly from the month of May.

EURUSD 73114

Related Articles
  1. Taxes

    5 Tax Moves To Make Before Year End

    Taxes aren't avoidable, but you shouldn't pay more than your fair share. Here are five moves you can make at year's end to lower your tax bill.
  2. Active Trading

    FYI On ROI: A Guide To Calculating Return On Investment

    Return on investment is a simple equation that can give you an edge when fine-tuning your portfolio - here's how to use it.
  3. Investing

    How to Take Maternity Leave as a Freelancer

    Freelancers are not covered under the Family and Medical Leave Act, but maternity leave is still doable with these tips.
  4. Retirement

    Roth 401(k), 403(b): Which Is Right for You?

    Learn how to decide between a traditional or Roth version of the 401(k), 403(b) or 457(b) retirement plans to help you build your nest egg.
  5. Mutual Funds & ETFs

    Why ETFs Are a Smart Investment Choice for Millennials

    Exchange-traded funds offer an investment alternative to cost-conscious millennials who want to diversify their portfolios with less risk.
  6. Markets

    What Is the Labor Market Conditions Index?

    The Labor Market Conditions Index is a new Fed indicator to track labor statistics. How useful is it?
  7. Investing

    Asset Manager Ethics: Acting With Competence and Diligence

    Managers must make investment decisions based on their personal investment process, which in turn should be based on solid research and due diligence.
  8. Investing

    Asset Manager Ethics: Acting In the Benefit of Clients

    Investment managers should always act to benefit the client. Learn what actions managers should take on a client's behalf.
  9. Investing Basics

    Calculating The Present And Future Value Of Annuities

    Here's everything you need to account for when calculating the present and future value of annuities.
  10. Economics

    The World's Top 10 Economies

    A look at the top ten economies in the world.
  1. Is North Korea a developed country?

    North Korea is one of the poorest and least developed countries in the world. It is far from a developed country. Because ... Read Full Answer >>
  2. Does Netspend accept wire transfers?

    NetSpend accepts some types of wire transfers to add money to the prepaid debit cards it issues to its customers. There are ... Read Full Answer >>
  3. Is Mexico a developed country?

    As of 2015, Mexico is not a developed country. However, it beats the majority of its peers in the developing world on most ... Read Full Answer >>
  4. Is China a developed country?

    Despite having the world's second-largest economy and third-largest military, China is still, as of 2015, not classified ... Read Full Answer >>
  5. Do FHA loans require escrow accounts?

    Federal Housing Administration (FHA) loans require escrow accounts for property taxes, homeowners insurance and mortgage ... Read Full Answer >>
  6. Is Greece a developed country?

    Greece is a developed country by most meaningful metrics. However, its financial struggles have been well documented in the ... Read Full Answer >>

You May Also Like

Trading Center