- The euro rallied a bit against the US dollar during the trading session on Wednesday.
- And at this point in time, I think we've got a situation where we are going to be eyeballing the 1.18 level, which is where we had a significant double top.
- With that being said, I think this is a market that will at least threaten to get above there, but if we can, that remains to be seen.
- A pullback from here is possible and it could send the Euro back down to the 1.16 level. Ultimately, I think you have a scenario where if you're cautious, you may see a situation where you get a better price, perhaps to go long around the 1.16 level or maybe even the 50 day EMA.
If We Break Lower than the 50 Day EMA
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If we break down below the 50 day EMA, then I am more than willing to start selling again. This is a market that is solely focused on the Federal Reserve, it seems. And traders still believe that the Federal Reserve is going to cut several times between now and the end of the year. Whether or not that's true remains to be seen. And you will have to pay close attention to statements coming out of Federal Reserve members.
But at this point, it looks to me like a market that is going to continue to be very noisy and choppy, which is typical this time of year as a lot of traders are probably away for the holiday more than anything else and not really adding a lot of volume to the situation.
We are in the midst of consolidation, maybe getting ready to roll over. We'll just have to see. But as things stand right now, I'm not ready to start shorting.
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