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Technical Analysis

The technical analysis is very negative, but we are approaching an area that is rather supported. The 1.25 level of course is a large, round, psychologically significant figure, and a lot of people will be paying close attention to whether or not we can find buyers in this region. Furthermore, there will be a lot of options being traded in that general vicinity, so therefore it offers a certain amount of support. This is an area that has been important multiple times so I think a lot of traders will be paying close attention to it. On the other hand, if we were to rally from here, the market could go looking to the 200 Day EMA near the 1.2850 level, which of course is an indicator that a lot of people pay close attention to. For what it is worth, the 50 Day EMA has fallen a bit again, and it looks like it is trying to do everything it can to cross below the 200 Day EMA, kicking off the so-called “death cross.”

All things being equal, this is a pair that is fairly negative, and I think may continue to be so. Quite frankly, I think any time this market rallies, you will be looking for signs of exhaustion that you can start selling again. I have no interest in buying this pair anytime soon.

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