EUR/USD Forecast May 16, 2017, Technical Analysis

The EUR/USD pair had an explosive moved at the open on Monday, reaching towards the 1.0990 level. However, the 1.10 level above continues to offer significant resistance, and the fact that we a forming a shooting star on the hourly chart suggested that we got a little bit overbought. On the Stochastic Oscillator, we are in an overbought situation on the hourly chart, so it looks as if we are going to continue to go back and forth in the larger consolidation area. I think if we can break above the 1.10 level, the market could go higher, but I don’t have any interest in buying until we close above there on at least an hourly chart.

The Federal Reserve and interest rate hikes

I believe that the reserve raising interest rates will continue to favor the US dollar from time to time, and this is one of those times. The European Union continues to have a significant amount of issues, and that should continue to be a bit of a headwind when it comes to this pair. I think that we will continue to see a lot of back and forth action, and that should continue to be the best way to play this, and a range bound manner. I think that the 1.0925 level below should offer support, just as the 1.10 level above offers resistance. This is a nice short-term selling opportunity, but I do believe that it’s only a matter of time before the buyers return and start getting involved again based upon what they perceive as value. Either way, it’s going to be volatile as we try to make headway in one direction or the other in a market that seems a bit directionless. You must be nimble if trading this currency pair. - The company, employees, subsidiaries and associates, are not liable nor shall they be held liable jointly or severally for any loss or damage as a result of reliance on the information provided on this website. The data contained in this website is not necessarily provided in real-time nor is it necessarily accurate.

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