- The euro has been slightly positive during the early hours here on Tuesday, as we continue to see a lot of noisy behavior coming out of the Forex markets, especially as traders are trying to get an idea as to where monetary policy is going to be with the Americans.
- After all, the Fed Funds Futures markets are pricing in an almost guaranteed 25 basis point rate cut coming out all the FOMC meeting on September, but I do think you also have to keep in mind that the real question will be whether or not Jerome Powell sounds dovish later this week in his Jackson Hole Symposium speech.
Technical Analysis
Top Forex Brokers
The technical analysis for this market is somewhat neutral at the moment, as the 1.16 level underneath is going to offer a certain amount of support, right along with the 50 Day EMA sitting there. The 50 Day EMA of course is an indicator that a lot of people will be watching closely, as it has behaved for the most part like a trendline. As long as that ends up being the case, then I think you have a certain amount of buying pressure underneath. Furthermore, we have been in an uptrend, but I would also point out that we had seen a major double top near the 1.18 level just a few weeks ago. In other words, I think it makes sense that we get a bit of consolidation in this area.
We are at the end of the summer vacation season when things culminate and typically there is a lack of volume. The end of August is pretty miserable for trading at times, just simply due to the fact that the bigger players are there. However, we have enough going on at the moment that I think we will continue to see a lot of choppiness and attention paid to this pair but given enough time it should give us an idea as to where the US dollar is going overall. If we were to break down below the 1.15 level in this market, I suspect that the US dollar will not only strengthen against the euro to reach the 1.12 level, but it will also probably break a lot of other currencies.
Ready to trade our daily Forex analysis? We’ve made a list of the best online forex trading platform worth trading with.