EUR/USD Forecast Today - 21/01: Euro Rallies In Thin Liquid

(MENAFN- Daily Forex)

• During my daily analysis of major currency pairs, the EUR/USD pair captured my attention because we have seen a massive move higher in this market.
• At the time of writing the euro is up 1.32%, but quite frankly this is a day that you need to look at through the prism of potential opportunities, as the liquidity would have been then due to the Martin Luther King Jr. holiday in the United States, and the fact that New York was off-line for the most part.

Technical Analysis

The technical analysis is of course very important looking at this chart, with the 50 Day EMA sitting near the 1.0450 level, and dropping quite drastically. All things being equal, there's no real reason for the euro to take off to the upside, and this will more likely than not end up being a nice selling opportunity. In fact, I've been looking for some type of rally that I could fade, and this might be it. That being said, I will be watching closely to see whether or not the market could go higher, perhaps breaking above the 50 Day EMA and falling near the 1.05 level.

Underneath, the 1.03 level is an area that I think a lot of people will be watching, as it is important from the stance that it is a large, round, psychologically significant figure. Therefore, I think you have to understand that this is a market that will continue to pay close attention to this price region. Quite frankly, by the end of last week, it became clear that we are in the midst of trying to form some type of basing pattern, but I think that pattern is simply going to be the next bounce that we can start fading.

What will be more interesting to me is how things end up at the end of the day on Tuesday, now that we have got through a holiday where a lack of liquidity may have made things a little bit exaggerated. At this point, it's not really until we break above the 1.06 level that I would think that the market is likely to continue to go higher for a bigger move Forex Brokers1 Get Started 74% of retail CFD accounts lose money

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