EUR/USD Finds Support to Form Massive Hammer - 10 September 2015

The EUR/USD pair fell during the course of the session on Wednesday, but found enough support near the 1.1150 level to turn things back around and form a massive hammer. This is of course a very bullish sign, and as a result I feel that it’s only a matter time before we bounce yet again. I believe that there is support all the way down to the 1.11 handle, and that overall the market should bounce back towards the 1.13 level. Overall, the consolidation is a symptom of lack of clarity in my opinion. It is a lack of clarity with the Federal Reserve and what they are going to do with interest rates that keeps this market grinding away.

Looking at this chart, I believe that if we can break above the 1.13 level we could then go to the 1.15 level. Having said that, I think that it will take a bit of momentum building in order to reach that level though. Because of this, it makes sense that the choppiness continues.

Short-term trades

I believe that this market will only offer short-term trades, so I am actually looking towards short-term charts for signs of trading opportunities. I believe that we will continue to see a lot of back-and-forth type of action, so I am only hanging onto any trades that I take for a couple of hours at best. While frankly, this is not my favorite market traded at the moment, as there seems to be a lot of trepidation about getting involved.

Sooner or later, I feel that the market will have to break out obviously, but we aren’t showing any real signs of doing so quite yet. I suspect that the Federal Reserve will do an interest-rate hike, but it will probably be a one-time affair. If that’s the case, this market should ultimately break out to the upside, which would be signified by the breaking of the 1.15 level to the upside.

EURUSD

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.