EUR/USD: September 2014 Forecast

The EUR/USD pair broke down over the course of the last month, as August was absolutely horrible for the Euro. As you can see on the weekly chart attached this article, we had three hammers in a row that were broken down below with a massively bearish candle. On top of that, at the very end of the month, we had the market gap lower, showing just how bearish the Euro had suddenly become.

There is anticipation that the European Central Bank could in fact start to add quantitative easing, and with that I feel that this market could drop further. In fact, I believe that the real support is all the way down to the 1.28 level, but I’m not foolish enough to think that the Euro is simply going to fall apart. This is a currency that traders tend to buy time and time again, so even when it’s bearish, it’s only somewhat bearish.

Selling rallies.

We have seen this market fall apart, and as a result I think that the bearish momentum is starting to really pick up. Any rally at this point time I’m looking for an opportunity to sell, at least until we get down to the aforementioned 1.28 handle. Down there, I would expect to see a lot of supportive pressure, so I think that while the September month will probably be negative for the Euro overall, I think that the downside is somewhat protected in that particular region.

I think that it is and until we go back above the 1.35 handle that we could seriously consider the market has been turned around. With this type of massive break down, and quite frankly the smashing through of three hammers on the weekly chart, this does not bode well for the Euro. Ultimately though, I would expect a lot of choppiness as per usual, as this pair likes to do just that. Nonetheless, I will be pounding the Euro from the short-term charts time and time again for the month of September.

EURUSD 83114

Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.