The Euro has gone back and forth during the entirety of the week as per usual, but this time the most recent highs were not touched. This means that the highs are getting lower, and therefore we could be seen a bit more bearish pressure. The 200 week EMA sits above at the 1.14 level, an area that is crucial to pay attention to. At this point also, you have to wonder whether or not the Euro is not going to run out of momentum. After all, it has made several attempts to break out, but it continues to fail.
EUR/USD Video 06.07.20
This is somewhat similar to the Australian dollar, although in that pair the Aussie did manage to close quite a bit higher in the body of the candlestick, keeping about 85% of the gains. With that in mind, perhaps the real trade is to short the EUR/AUD pair, not necessarily mess around with either one of these pairs that are sitting at major resistance. Nonetheless, I do believe that the Euro is probably going to come under a little bit of pressure, so at this point in time it is likely that we will see noisy trading that continues to favor fading rallies in the short term.
Longer-term, if we can break above that 200 week EMA, that could be a very bullish sign, just as breaking below the 50 week EMA underneath would be an extraordinarily negative sign. Expect more choppy behavior, that is what this pair typically does.
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This article was originally posted on FX Empire
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