For the better part of six weeks, the EUR/USD has been on an undeniable hot streak. Exchange rates are up more than 500 pips as the euro has dominated the Greenback since 1 November. However, the past several sessions have produced a pullback in valuations. If we see rates continue to fade during mid-December, a buying opportunity may come into play.

The big news on the euro front remains the ongoing U.K./E.U. Brexit negotiations. Reports from Reuters suggest that a “no-deal” split between the two unions is growing more likely by the day. Here are a few key quotes from E.U. chief negotiator Michel Barnier taken earlier today:

• Barnier stated that he believes a “no-deal split in ties with Britain is now more likely than an agreement on a trade pact.”
• Anonymous sources said that Barnier made the statement at a meeting with 27 European affairs ministers.
• Barnier also added that it is time for the bloc to “update its no-deal contingency plans.”

Thus far, the euro appears to be coming out on top vs the GBP and USD through the latest Brexit news. However, given today’s uncertain tone, there is a chance that the EUR/USD will put in a test of downside Fibonacci support.

A Possible Buying Opportunity In The EUR/USD

At press time, the EUR/USD is trading flat near the 1.2115 level. Participation is moderate as forex players price-in the ongoing Brexit developments.

Here are the key levels to watch in this market for the remainder of the week:

• Resistance(1): Spike High, 1.2177
• Support(1): 38% Current Wave, 1.2032
• Support(2): Daily SMA, 1.1992

Bottom Line: Should the EUR/USD extend weekly losses, a buying opportunity may set up from the 38% Current Wave Retracement (1.2032). As long as the Spike High (1.2177) is valid, I’ll have buy orders in the queue from 1.2039. With an initial stop loss at 1.1989, this trade produces 50 pips on a standard 1:1 risk vs reward ratio.