Good morning Traders!
Today there are several members of the Bundesbank due to speak, and as the Bundesbank is a very influential member of the European System of Central Banks, we may see increased activity in the Euro.
Let’s start with the Daily chart. The Daily chart is in a confirmed uptrend, and after breaking to a new Higher High, the market was over extended and it is currently in the process of pulling back, and releasing some of the strong buying pressure. On the Weekly chart, we also have a newly confirmed uptrend, with last week candle breaking and closing above the area of around the 0.89.
Drawing the Fibonacci retracement on the Daily chart, has the 38.2% clustering with the High at the round number of the 0.89, which is also the Weekly previous swing High. However, this may be a shallow pullback, and the market may decide to pullback further. In this case, I’ll be looking at the 61.8% retrenchment, which is clustering with the previous Daily swing High, but also with a previous level of support, as can be seen on the Monthly chart.
This is my preferred scenario, as it allows for a further distance from the last Higher High.
As always, I’ll be looking at the lower timeframes for signs that the pullback is over, and the buyers are ready to take control once again.