EUR/USD: Diving into new territory!
Big moves in the market yesterday evening as we saw the Federal Open Market Committee (FOMC) announce they are cutting their benchmark rate by 25 basis points. This result has triggered an already bullish US Dollar to extend recent gains to two-year highs.
This in turn has seen a further push lower on all major USD crosses and has given the EUR/USD bears what they needed to break through the strong support held at 1.1110 and reaching a low of 1.1033, creating new two year lows!
This is new territory for the most traded currency pair as it currently tries to find its feet in new waters, the question is how deep are these waters and will we find a bottom!
Markets are volatile this week as we have seen on the back of the FOMC rate news release but there is more volatility expected this week with the Non Farm Payroll data release tomorrow.
This can be make or break for this currency pair and can push lower to new depths or pull its head back above water level. This level being the support level broken yesterday at 1.1110 which will be crucial to watch for the weekly close. If we see price sustain the break below it opens up downside targets of 1.1000 and then lower BUT shall we see price close above 1.1110 , possible due to weak NFP numbers next week could be bullish for EURUSD.
Very interesting end of the week to come with this pair and I will be watching closely.