The Euro rallied a bit during the trading session on Wednesday, as it looks like we are simply bouncing around in the short term, using the 50 day EMA as a magnet for price. At this point, the 1.10 level underneath should be support, just as the 1.11 level above should be resistance. At this point, the market looks likely to see a lot of noise in this general vicinity. It makes quite a bit of sense though, considering that Brexit is a very disruptive event. We continue to see a lot of headlines and rumors out there that cause issues, and I think that’s going to continue to be the case going forward.
Euro to Dollar Forecast Video 17.10.19
The Federal Reserve is likely to cut interest rates going forward so that of course works against the value of the US dollar, but by proxy that doesn’t necessarily mean that the Euro needs to rally. After all, the European Union is heading into a recession, but during the trading session on Wednesday we received very poor retail sales numbers coming out of the United States which is one of the foundations of the US economy. If that’s going to be an issue, then that could provide a little bit more drive toward the US dollar and an ironic twist, because people will be buying bonds. All things been equal though, pay attention to the 1.11 level as the gateway to the 1.12 handle. Signs of exhaustion should roll this market right back over towards the 1.10 level. Longer-term though, we are still in a downtrend.
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This article was originally posted on FX Empire
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