The Euro initially rallied during the trading session on Tuesday, but as you can see it has given back quite a bit of the gains to shrink down towards the 50 day EMA again. That being said, the market continues to see a lot of noise, and at this point it looks as if it is going to try to break down below the 1.21 handle. If it does, then we are almost certainly going to go looking towards the 1.20 handle, which is an area that I think a lot of attention will be drawn towards the market. If we were to break down below the 1.20 handle, it is likely that the 200 day EMA then comes into the picture that could offer support as well.
EUR/USD Video 16.06.21
It is at that point, when we break down below the 200 day EMA, that I think that the Euro gets absolutely crushed. That would almost certainly be a major “risk off” type of event that people would be paying attention to. Ultimately, if we break above the top of the candlestick for the trading session on Tuesday, then we could see a move towards the 1.2250 level. Breaking above there then opens up the possibility of a move towards the 1.25 handle, but we are obviously struggling to get to that scenario.
With this, I think that the market continues to see a lot of choppy behavior but at the end of the day we are probably going to have to wait for the end of the Federal Reserve meeting to have any real clarity as to the next move that we are making.
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