Judging from today’s market action, the EURUSD currency pair appears to be one of the most clearly “catch the wave” pairs. U.S. data such as ADP and ISM are expected to be worse than before, continuing to weaken the dollar and opening the way for the euro to push up the exchange rate. The uptrend in EURUSD has become smoother and easier to follow as market sentiment favors selling the USD.

On the chart, the price is moving steadily above the uptrend line with minor pullbacks, with immediate buying power appearing on each pullback. The 34 EMA and 89 EMA also expanded higher, indicating that the upward momentum remains strong. At the current rate of rise, EURUSD is gradually moving towards the 1.1650 area – the previous high that the market reacted strongly to.

My preferred scenario: The pair could see some minor moves around current levels to gather more liquidity before continuing higher to retest the 1.1650 level. If news from the U.S. is as negative as expected, a breakout at the top could easily occur.

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