- The Euro was a bit negative during the trading session on Tuesday. Again, as we continue to see a lot of back and forth.
- The back and forth of course is a sign that the market is trying to work off some of that excess froth.
- At this point, the 1.15 level is a major resistance barrier. And if we can break above there, then it really sends the market much higher.
Underneath we have the 1.13 level is a significant support level. And therefore, I think we're just kind of stuck in this range. And the fact that we are trying to work off some of the excess buying pressure and basically absorb all of that momentum is not a surprise.
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And you have to recognize the fact that Friday is non-farm payroll, so that has a major influence as well. Ultimately, this is a market that I think we are going to continue to see a lot of indecision. So if you are a short-term trader, this might be the market for you going back and forth with a range-bound system. By the end of the week, we might get some resolution. But I would say this, if we break back below the 1.12 level, I think that unravels the entire narrative at the moment, and we probably go lower.
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On a move above the recent highs, then it's likely that the market could go looking to the 1.18 level, but it may take some time to get there. After all, EUR/USD is a pair that spends a lot of time doing very little under normal circumstances, although admittedly, we are not normal circumstances at the moment. Back and forth, I think, is where we're going.
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