The Euro continues to recover from the Turkish lira crisis, as I believe that the pundits in the market are starting to realize or perhaps it was oversold as a result. There has been no contagion yet, and it appears that the US dollar is correcting a bit overall. This of course helps the Euro, as it is the largest trading partner in the currency market to the greenback. Overall, I believe that we will continue to see a lot of volatility, but I think that the 1.15 level will retain its importance going forward. Ultimately, this is a market that I think is probably going to try to break above the 1.16 level, and if it does then it could fulfill the previous consolidation range, extending to the 1.18 level and possibly even higher than that.

That doesn’t mean that it’s good to be easy, there will be pullbacks occasionally, but right now this is what I’m thinking. However, things would change if we broke down below the 1.15 level as it would be a breach of significant support. Not only is it structurally significant, but it is also very psychologically significant. This should continue to play a part in this market, so therefore I think we will see a reaction every time we get close to the 1.15 level, regardless of the direction. Choppiness is what I would expect, but quite frankly that’s nothing new as the headlines continue to be very erratic in general.

EUR/USD Video 27.08.18

This article was originally posted on FX Empire

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