Last week was important for the Euro as the ECB decided to ramp up some serious pressure to the downside. We saw the EUR/USD tumble from 1.1850 all the way down to 1.1600.
If you’ve been following the FX Leaders Team you would have noticed that we’ve been pretty bearish on the Euro in recent weeks and rightfully so. As the USD strengthens all the majors are coming under pressure and the Euro has been one of the weakest.
This week the FOMC interest rate decision and accompanying statement will really shape the Euro. Given the rate of interest rates will probably be increasing faster in the US than the Eurozone, the EUR/USD will be under pressure.
Trading Plan
We’re sitting at a support turned resistance level around the 1.1600 mark. The next swing low is at 1.1500, which tells me that we have some more room to move. If we can spike a little higher, back to say 1.1650, then we will have a nice pullback and a great risk/reward opportunity.
But just remember, the FOMC and non-farm payrolls are big events so keep your risk measure tight this week.
EUR/USD – 240 min Chart.
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