Talking Points:
• EURUSD has made a few strong moves this past week - first breaking 1.1000 and Monday's recovery to 1.13
• General market conditions do not support easy development of trends from FX pairs or risk benchmarks
• The same key fundamentals may also work as an anchor to progress with the FOMC and Greece further out
Want to develop a more in-depth knowledge on the market and strategies? Check out the DailyFX Trading Guides we have produced on a range of topics.
EURUSD experienced a strong rally Monday after two days of retreat. With the 1.1000 break fresh in our minds, this may look like the next phase of a more substantive bull trend. However, follow through may be more difficult to muster than this bout of volatility may suggest. Using concepts we have discussed individually in previous Strategy Videos, there is reason to be skeptical of momentum. Market conditions first and foremost are not readily supportive of trend development - whether we are looking at 'majors', the FX market as a whole or even other asset clases. Furthermore, the fundamental drive in this move is not readily apparent. In fact, it is more likely to short-circuit moves as we wait for clarity on the Fed's position at next week's FOMC meeting or on Greece whenever clarity is provided there. So, in today's Strategy Video, we discuss the scope and ease of follow through for EURUSD.
Sign up for John’s email distribution list, here.
