The euro is putting up stiff opposition around the 1.0560/80 level
The 1.0580 area is seeing a lot of action and as we've highlighted several times, it's protecting the multi-year lows.
While it's looking strong for support, I don't like the fact that we're failing to bounce significantly.
EURUSD 30m chart
When I say significantly, I'm not talking a thousand pips but at least a move to up near the 38.2 fib of the Nov drop would be a signal that the pair is showing consolidating tendencies.
EURUSD H1 chart.
The fact that bounces are very shallow is a big flashing warning sign.
The obvious reasoning why we're not really moving much right now is that we have the Fed and ECB meetings to come and they are going to be big events. A Fed hike is nailed on, as far as expectations go so there's little room for USD strength if they do. However, it will be the message that comes with it that's important. But, the ECB come first and that's going to be where we make a sustained move. If we get a message that the QE taps are staying open on full and extended, then we could see the those parity calls come closer. Anything else less than that is going to be a buy.
In the meantime, we can have some trust in the support levels for longs, and offloading towards 1.0650 & 1.0700 looks the play. Shorts can do the reverse.
