By FXEmpire.com
The EUR/USD pair had a very strong week for the last five sessions. The 1.30 level has been very supportive, and the bounce form that level continues. The previous week had formed a shooting star, and the candle from the week looks as if it wants to challenge the bearishness that had been shown the week before.
The Spanish managed to sell their ten and two year bonds that everyone was worried about, albeit at slightly higher yields than expected. The pair features a lot of uncertainty, and as such will be very choppy overall. The market will more than likely be difficult going forward as there are going to be many different possible headlines. The problems in the European Union aren’t fixed yet, and as a result there will always be potential minefields going forward.
The 1.30 level is without a doubt going to be the major hurdle for the bears, but the upside is more than likely going to be somewhat limited as well. Going forward, a real back and forth grind seems to be likely as the market tries to come to grips with the potential bad headlines, and the never ending potential for “hopium” to return to the markets from time to time.
The market looks as if we are going to continue to grind between 1.35 and 1.30, and there is little to suggest that we are going to break out in the immediate future. The market simply has too much to digest in order to make the decision, and as such the action will more than likely favor shorter focused traders in the near term. However, if the markets break through the 1.30 level to the downside – we will see this pair fall apart. A breech of the 1.35 level would be massively bullish and demand a long position for the foreseeable future. The French have elections coming, and there are also Greek ones in a short time. It may take one of those events to finally break free in this pair. Until then, we leave the trading to be done on shorter time frames.
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Originally posted here
