- The EUR/USD experienced some volatility during Friday's trading session, pulling back before ultimately showing signs of life.
- The market is currently facing significant resistance just above its current level, but if it can take out the recent high from last week, it may have the potential to reach the 1.1250 level.
- However, there are concerns regarding the overall attitude of the market that must be taken into consideration.
The 1.09 level serves as significant support for the Euro, and if it breaks down below that level, it may fall down to the 50-Day EMA, which sits around the 1.08 level and is currently rising. Many technical buyers may be interested in getting involved at this level, adding upward pressure to the market. However, that’s not the “be-all-end-all” of support, so it’ll be interesting to see how the market reacts in that area, and therefore it’s probably worth noting that a breakdown through that area could be rather ugly in the future. Regardless, volatility is something that you could probably expect.
The European Central Bank's hawkish stance is also contributing to the market's upward pressure, but whether it will continue to do so remains to be seen. Similarly, the Federal Reserve is expected to remain tight, but not raise rates much further than they already are. As such, traders are betting that the Euro has not yet been priced in all the tightening.
The Euro is Currently Facing Significant Resistance
However, the market is on the precipice of several potential financial issues, which may prompt investors to seek safety in the US dollar. Typically, the Euro gains initially during such issues before investors make a massive run to the US dollar. As such, it remains to be seen whether the market will continue to remain bullish in the face of significant resistance.
In conclusion, the Euro experienced volatility during Friday's trading session and is currently facing significant resistance. While the market has the potential to reach the 1.1250 level if it takes out the recent high from last week, concerns regarding the overall attitude of the market must be taken into account. The 1.09 level serves as significant support, with the 50-Day EMA also adding upward pressure to the market. However, traders must remain vigilant regarding potential financial issues that may cause a massive run to the US dollar.
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