EUR/USD Showing Bearish movement: Keep buying the US dollar
EUR/USD Showing Bearish movement
The EUR/USD pair dropped again during the session on Monday, after initially trying to rally. As you can observe the trend has been unbroken for some time, as indicated by the 50 exponential moving average on this daily chart. I find no way in which I would be buying this pair, although it does look a little bit overextended to the downside at the moment. With that being the case, bounce possibly will come but I am not going to buy that, I assume that is simply going to offer value in the US dollar. Moreover, let this pair bounce: it is only going to present another selling opportunity as far as I can observe.
I consider that the market then comes lower to the 1.2050 stage given enough time, as it is the beginning of the uptrend that we have totally decimated now. With that being the case, it is only a substance time before this thing falls apart. Can it get lower there? Of course yet again, but honestly I think we are starting to get into the very lower part of the downtrend.
Keep buying the US dollar
The only thing I can do right now is keeping buying the US dollar. I have no attention in selling it against any currency, and even though the Euro is most likely a bit oversold at this stage in time, I surely would not sell the US dollar against the Euro, or in other words – buy this pair.
I imagine that the problems in Europe will keep on to work against the Euro going forward, but I cannot help but observe that the 1.20 level is a massive floor in this market on the monthly timeframe. With that being the case, I have to consider that the area will again draw buyers as the Euro would be extremely cheap.
Eventually, I believe that we have selling chances for a little while, and I will be giving a lot of concentration to the longer-term charts about 100 pips below here, since I think we possibly will get a nice turnaround signal for the longer-term play.