(MENAFN- Daily Forex)

• The market trades noisily after gapping higher, settling into a compressed range ahead of the Thanksgiving lull.
• Despite lighter volume and potential sideways drift, overall bullishness persists with key levels guiding near-term direction.

It continues to be very noisy during the trading session on Tuesday as we have gapped to the upside to kick things off. That being said, this is a market that continues to see a little bit of compression, and I think that does make quite a bit of sense. After all, we have to keep in mind that the Thursday session is Thanksgiving, so the futures market will shut down for a chunk of the day. And then the Friday session will probably be somewhat thin due to the fact that a lot of Americans won't bother to go back to work.

That being said, I think it makes a lot of sense that we have been going back and forth in this general vicinity after that huge move to the upside, but it is worth noting that the volume has dropped a bit, and therefore, I think we are just settling into a nice range.

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That being said, it looks like the triangle is forming, and that could get the market really going. But there's also the possibility that we just simply drift sideways. If that's the case, then I would look at a range between the $4,000 level and the $4,200 level. The 50-day EMA sits just below the $4,000 level, so that offers a bit of support as well. If we were to break down below the $3,950 level, then I think you've got a situation where the market is likely to go down to the $3,500 level.

EURUSD Chart by TradingView

Ultimately, I think this is a market that is going to have to make a decision as to whether or not traders can really get involved. But I think you also have to look at this as a market that desperately needs to take a breather after that move. All things being equal, it does still look bullish. But I think a little bit of sideways grind is probably likely to be the case because that's what gold does most of the time. Central banks around the world continue to put a bid in this market, but at the same time, we will have to see if a strengthening US dollar starts to work against it.

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