The conflict in Libya is worsening, and the potential demonstration and unrest in Saudi Arabia in the next few days are making all Traders sleepless with the surge in Vix index.The possibility of oil hitting 150 per barrel cannot be discarded near term.
Until oil prices show some signs of pullback, the rally is likely over unless the markets can find new fundamental reasons that suggest growth can continue
Last week, after an initial, 100 pip (0.72%) rise to the 1.3950 area, the EUR made little upward progress and being rejected near 1.4000. This suggests that much of the news was already priced in. It also raises questions about how much near term upward energy the EUR has.
Most of the rate hike expectations have now been priced in, leaving continued EUR up trends depending on rising risk appetite.
However, Risk appetite may not be also driven by the unclear growth futures of the entire economy if the high price of oil holds for a longer duration.
Thus while we must respect and continue to trade with the EUR’s near term up trend, we must suspect it’s durability and be ready to play the short side on any signs of profit taking.
This coming Friday’s EU economic summit, and may spark new volatility in the EUR pairs, especially with the Euro already overbought in the near term., Considering the movement of the newly elected Irish Government, the upcoming Local Germany election, and the pending announcements on the EC on bond and further rescue policy for Greece, Spain, Portugal.
Daily Euro/Usd Chart
The above chart shows the Resistance at 1.4040, and support near 1.3850. PA for the next few trading days are expected to be volatile, but the Bullish momentum is still intact as long as the 1.3850 is sustained.
The possible lifting of Euro/Usd on the completion of ab-cd pattern may see it retest the next target near 1.4300 areas.
Watch out clues from S&P 500 movements and the oil price volatility and the possible unrest in Saudi and the upcoming EU summit this Friday.
Until oil prices show some signs of pullback, the rally is likely over unless the markets can find new fundamental reasons that suggest growth can continue
Last week, after an initial, 100 pip (0.72%) rise to the 1.3950 area, the EUR made little upward progress and being rejected near 1.4000. This suggests that much of the news was already priced in. It also raises questions about how much near term upward energy the EUR has.
Most of the rate hike expectations have now been priced in, leaving continued EUR up trends depending on rising risk appetite.
However, Risk appetite may not be also driven by the unclear growth futures of the entire economy if the high price of oil holds for a longer duration.
Thus while we must respect and continue to trade with the EUR’s near term up trend, we must suspect it’s durability and be ready to play the short side on any signs of profit taking.
This coming Friday’s EU economic summit, and may spark new volatility in the EUR pairs, especially with the Euro already overbought in the near term., Considering the movement of the newly elected Irish Government, the upcoming Local Germany election, and the pending announcements on the EC on bond and further rescue policy for Greece, Spain, Portugal.
Daily Euro/Usd Chart
The above chart shows the Resistance at 1.4040, and support near 1.3850. PA for the next few trading days are expected to be volatile, but the Bullish momentum is still intact as long as the 1.3850 is sustained.
The possible lifting of Euro/Usd on the completion of ab-cd pattern may see it retest the next target near 1.4300 areas.
Watch out clues from S&P 500 movements and the oil price volatility and the possible unrest in Saudi and the upcoming EU summit this Friday.
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