The midweek of the trading week is here and the markets are jumping with volatility. This morning Congress passed a $900 billion stimulus package for the United States. This news led to a rapid depreciation in the US Dollar and several setups priming for entry.
Price action traders have entered EURUSD longs with a long term target of 1.22500. Price has pulled back to this week’s high and has printed a bullish hammer, indicating the next leg up. Smart money analysis is seeking 1.22500 as an upside objective. Both trading principles are forecasting further Dollar bearishness in the coming days.
In addition EURUSD, NZDCAD is setting up for a potential selloff. Price has been stuck in a daily range since the first week of December. Swing traders are waiting for a break of the daily range’s low to take an entry short. Intraday smart money traders are looking for price to clear the current 4hr breaker candle to enter short.
The Euro PMI that was released during the London session came out bullish and has added an extra incentive for the Euro to rally higher. Fundamental analysis predicts that this event in addition to a new stimulus package provides EURUSD all it needs to move higher. Tomorrow is a key fundamental day as the UK announces its monetary policy. Traders are advised to manage risk accordingly during that time.