2023-12-16 12:34:41
The Euro achieved an impressive performance during Thursday’s session, as it rose to the upside, targeting the crucial 1.10 level. The European Union chose not to raise interest rates, but they indicate they still have a long way to go to deal with inflation concerns. This represents a stark contrast to the situation in the United States. This difference in approach might represent a major shift in the market, and it is clear that the market is keen to go higher. The level of 1.10 is of great importance, as it is a large round number that will attract the attention of many traders. If we can break above this level, it might attract more buyers into the market.
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As we approach the holiday season, we must take into account liquidity constraints in the market. In addition, there is the possibility of some profit taking. In simple terms, there may be a temporary drop in prices, but the Euro looks set to continue its rise towards the end of the year, and possibly into next year. While the European Central Bank (ECB) may eventually consider cutting interest rates, the market currently appears to have seen a notable shift in direction and remains firmly in bullish territory. Of course, this situation might change if there is a significant shift towards risk aversion, causing investors to flock towards the US dollar.
The recent crossover of the 50-day moving average above the 200-day moving average, often referred to as the “golden crossover,” has caught the attention of many traders and algorithmic trading systems. This sign is viewed positively, and increases the overall bullish sentiment. If we break above 1.10, the next target might be around 1.1250, a level of previous importance.
Ultimately, the Euro had a strong performance on Thursday, and appears to be on a strong upward trajectory. The 1.10 level is a pivot point to watch, and a break above this level might increase buying interest. While volatility and profit-taking considerations are possible in the short term, the prevailing momentum points to a positive outlook with the potential for further gains in the coming days.
Possible signal: While you may already be long in this market, a daily close above 1.10 opens the way for a move to 1.1250. I will be targeting 1.1220, and will place a stop loss at 1.09.
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