The EUR/USD pair fell during the session on Friday after the nonfarm payroll number came out stronger than anticipated. This of course drove money into the US dollar as it is a sign that the US economy is getting better, and naturally the Euro got punished for all of its issues. With that being the case, and the fact that we were testing the 1.15 resistance barrier, is not much of a surprise to me that the market fell. Unfortunately, we did not get a resistant candle in order to start selling on the longer-term. In other words, you either had to be short before the announcement, or immediately afterwards in order to take advantage of the move.
It’s always difficult to be in the market ahead of the nonfarm payroll numbers, but certainly selling this pair was the only thing you could have done. If you are already short on this market for the longer term, then of course there was no issue. What I find interesting about this pair is that we have formed a shooting star on the weekly candle which shows the 1.15 level been very resistive. Because of this, I believe that we are going to continue to go lower.
Support is just below
I see some support at the 1.13 level, but I do not think that it’s major support. I think it is simply a minor support area that the market is focusing on at the moment. Ultimately, I believe that this market will go much lower, and test at least the 1.10 level. Because of that, I continue to sell rallies on the short-term charts as they appear, and also keep a nether longer-term short position on in a separate account. I believe that the Euro is going to have problems going forward for some time, and as a result there’s really no reason to be involved in trying to buy a bounces or pick the bottom of the downtrend. In fact, at this point in time I’m ignoring all buy signals.
