The Euro has bounced from the 1.20 level to show signs of strength again during the Thursday session. This front run the jobs number coming out of America so it will be interesting to see how this plays out. I do think that there is a little bit of resistance just above that could cause some issues, but at the end of the day we are in an uptrend and you could even make a little bit of an argument for a bullish flag or on shorter time frames a falling wedge.
EUR/USD Video 07.05.21
It is obvious that the 1.20 level would catch a lot of attention, and of course the 50 day EMA sitting there makes quite a bit of sense as far as support goes as well. With all of that in mind I think that what we are looking at is the possibility of a move back towards the highs that we made a couple of weeks ago. Ultimately, I think that this remains a short-term “buy on the dip” type of market, but if we were to break down below the 50 day EMA, perhaps after the jobs figure, then we will more than likely go looking towards the 200 day EMA underneath.
Remember, this pair does tend to be very choppy and sideways most of the time so although it is grinding higher, you will probably find more value buying the Euro against other currencies. In the short term though, the US dollar is on its back foot and as long as that continues to be the case in general, that will lift this pair and perhaps send it towards the 1.23 handle.
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