- The euro continues to drift a bit lower against the US dollar, but ultimately this is a market that I think continues to see a lot of upward momentum, as well as down, as we are essentially stuck in a range.
- Both of these central banks are likely to loosen monetary policy later this year, and that of course has a big part to play in what happens next.
- After all, central banks have been about as clear as mud as of late, and of course central bankers continue to chirp from speeches to move markets.
- Market participants are simply waiting to see what actually will happen as the speculation had gotten out of control.
Given enough time, I expect the 1.07 level to come into the picture and offer plenty of support, just as the 1.10 level should offer plenty of resistance. With that being said, I am fairly ambivalent on this market, but I do recognize that it offers the opportunity to do a lot of range-bound trading. Unfortunately, we are not near the overall support or resistance areas that I pay the most attention to.
This pair might be a bit challenging
So, I'm essentially sitting on my hands. However, that's not to say that the EUR/USD is a pair worth watching because it gives you a good idea as to what's happening with the US dollar itself. As a general rule, if the euro is falling against the dollar, that means the dollar is probably strengthening against multiple other currencies around the world. That being said, if we can break out of this range, I think you have a real shot at a 200, maybe even 300 pip move based on basic measured move technical analysis. Ultimately, I think this is going to be a range bound pair for most of the year, so I'm not necessarily looking for anything big here to begin with. Over the longer term, I anticipate that we will probably trade in this range about 80% of this year, just like we did last year.
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