- The Dollar is proving too strong for the Euro.
- The pivot points are strong levels to look for as the price falls.
- Support trend line has now been broken, giving more power to the bearish sentiment.
Dollar Too Strong For Euro
The Dollar is just too strong for the Euro at this point, which has caused 6E to plunge 5.6% since its high back in July. The market has pushed the price below a support trend line, and the bulls are trying to hold it within a minor support zone.
The RSI is approaching oversold, but this is no long signal at all. The price is falling rapidly, with current support levels holding the price tentatively. The support trend line mentioned above will likely act as resistance now. The horizontal support seen on the chart below is at 1.075, and if it doesn’t hold, then the next level down is 1.06.
At the moment, everything is moving toward the sentiment of Dollar strength. This means it is very difficult for us to find long trades in 6E. It could be the best option here to wait to see how price reacts at current levels. Even if we do see a bounce, it might not be enough to hold 6E up. It would be a far better trade to wait to see if a consolidation phase forms and then potentially look for a long on a bullish candlestick formation. If we want to look for shorts, then it can be done, but at this point, we would be chasing the market lower, so it would be far more ideal to wait for a pullback on a shorter time frame and sell the rallies.
Look for the pivot point levels moving down for the target by applying the indicator to your chart. The RSI will likely move into oversold territory, which would be the signal to hold off on taking trades in either direction.