The Euro has gone back and forth during the course of the trading session on Friday as we are trying to stabilize heading into the weekend. After all, the US dollar has strengthened quite a bit, so it might be a little overbought. Ultimately, this is a market that I think is going to continue to grind towards 1.16 level, and short-term rallies then showing signs of exhaustion could then send this market much lower.
EUR/USD Video 23.08.21
The 50 day EMA is currently driving below the 1.1850 level, which had been resistance in the past. The 1.18 level is also resistance, so any rally that we get at this point in time it is likely that will be sold into. The US dollar has been picking up strength for a while now, and that does suggest that we are starting to see a lot of concern. If that is going to be the case, then the Euro of course is going to suffer. Furthermore, we are starting to try to price in the idea of tapering out of the Federal Reserve, and therefore it is likely that the US dollar could continue to pick up a bit of strength.
The market continues to find plenty of reasons to fall, and I believe that we are going to continue to see that be the case. The 50 day EMA breaking down below the 200 day EMA is the so-called “death cross”, which of course is very negative. Ultimately, this is a market that I think continues to see a lot of pressure, so ultimately that is the most important thing to pay attention to.
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