EUR/USD Forecast – Euro Continues to Bounce Back And Forth

Euro vs US Dollar Technical Analysis

The euro has bounced slightly during the early hours on Monday in North American trading after plunging during the Asian session. The 1.11 level has offered a significant amount of support in the short-term charts. And of course, you have to keep in mind that this is a market that does tend to move from one large figure to another. So, if we do continue to break down from here, then we could go looking to the 1.10 level.

The 1.10 level is an area that has been important more often than not. And therefore, I think it would be a bit of a floor if we did break down. On the other side, if we rally towards the 1.12 level above, that is a bit of a ceiling. I think this is a pair that continues to be very noisy and sideways. So, you have to keep an eye on the large round fingers as we move back and forth. This is a very technical pair, perhaps due to the fact that it is so highly liquid and therefore the options markets have a major influence on it as well. But furthermore, you have a couple of central banks that are loosening monetary policy.

So, you have to struggle somewhat to find a real winner here. The easiest way to use the Euro for me at least is going to be determining US dollar strength and then trading somewhere else. If the dollar is strengthening against the Euro, then I might look to buy it against something that moves a little quicker. Perhaps even an exotic currency, and of course vice versa. As far as trading this pair is concerned, you’re pretty much relegated to short term charts.

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