Euro Looks at Key Risk—What to Watch

03/31/2015 9:00 am EST

Focus: FOREX

David Rodriguez

Quantitative Strategist, DailyFX.com


David Rodriguez, of DailyFX.com, shares a follow-up video to the one featured last Tuesday and discusses how forex volatility prices continue to remain high and warn that the euro, US dollar, and other major currencies will see big moves in the week ahead.


  • Forex volatility prices remain high on another key week for major currencies
  • Keep an eye on the euro and US dollar near key support and resistance levels
  • High volatility prices keep us focused on our Breakout2 trading strategy

High volatility prices warn that the euro, US dollar, and other major currencies will see big moves in the week ahead. Here’s what we’re watching.

A highly-anticipated US Nonfarm Payrolls report tops foreseeable event risk this week, while ongoing uncertainty surrounding Greek financial assistance represents a substantial concern for the euro.

Focus will be on the EUR/USD exchange rate as it fails at key resistance and trades close to potentially pivotal support near $1.0760; a break below would lead us to watch for further weakness. And, indeed, EUR volatility prices—in particular—trade near multi-year highs as traders brace for the unexpected out of Greece. The potential for a major breakdown keeps us on the defensive until further notice.

Forex Volatility Prices Trade Higher on Key Week of Economic Event Risk

chart
Data source: Bloomberg, DailyFX Calculations
Click to Enlarge

Our trading strategy biases are mostly unchanged from last week as high volatility prices keep focus on our Breakout2 trading strategy. Yet it’s critical to note that things can change very rapidly, particularly in the euro. Traders should limit trading leverage given clear market uncertainty.

DailyFX Individual Currency Pair Conditions and Trading Strategy Bias

chart
Data source: Bloomberg, DailyFX Calculations
Click to Enlarge

By David Rodriguez, Quantitative Strategist, DailyFX.com

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