- The euro continues to be very tight and is in a consolidation area that seems to be rather strict.
- At this point in time, we are simply waiting for some type of economic news or momentum to come back into the marketplace in order to get it moving.
Thursday Was More of the Same
The Euro has gone back and forth during the trading session on Thursday as we just sit around and wait for some type of reason to move. The PPI numbers could make a bit of a difference during the session, but really at this point we are very much stuck in the same pattern that we have been in where we are just banging around between the 1.10 level on the top and the 1.07 level on the bottom.
In the short term, it's actually trading between the 1.09 level and the 1.10 level. With that being said, I think you've got a situation where you are just basically taking a look at this through the prism of a market that doesn't have anywhere to be. Because of this, I'm more or less apt to look at this as a tertiary indicator to trade other pairs. In other words, I'm using this as an idea as to what the US dollar may do in other markets. If we do break above the 1.10 level, it opens up a move to the 1.1150 level. If we break down from here, then you have the 50 day EMA offering support right along with the 200 day EMA. Either way, I expect noisy and choppy short-term trading.
I'm more or less neutral in the pair EUR/USD, but I know short-term scalpers will love this market as it can give them an opportunity to pick up a few pips here and there. I wouldn't get overly excited though. I don't expect this pair to be a big mover this year as both the European Central Bank and the Federal Reserve are likely to cut rates and therefore, I don't think we have anywhere to be for a big move. Things of course can change based on geopolitics, global economic growth, et cetera, et cetera, but right now there's just no momentum.
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