Euro rallies during trading session on Wednesday, using previous resistance as support
The EUR/USD pair has pulled back slightly during the trading session on Wednesday, reaching towards the 1.2350 level, an area that has been both support and resistance as of late, and was previous major resistance. I think the market should then go to the 1.25 level above, an area that will cause a lot of resistance. If we were to break above that level, then I think we will be free to fulfill my longer-term target of 1.32 above, which is based upon a break of a massive bullish flag on the weekly chart. I think that the market will eventually find reasons to go higher, and if we can stay above the uptrend line, extensively at the 1.23 level, I have no interest in shorting this market.
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If we did breakdown below the 1.23 handle, and the uptrend line, then I think we could drop down to the 1.21 level, an area that is massive in its importance as it was a major breakout point. It is essentially market structure, and if we were to break down below that market structure, it’s likely that we would continue to see even more bearish pressure. I have no interest in shorting until then, so I think that looking at the short-term pullbacks as value is probably the best way to go and what will be a choppy yet bullish market. I will be adding to any long position above the 1.25 handle.