The 1.08 line was breached and it is indicative of a strong bullish push. While the currency pair had since eased away from the middle bollinger band, there is nothing to suggest that the bullish momentum is over. If the momentum continues, we may see 1.1 as a bullish target.

A reversal may only begin with the failure of the resistance turned support region of 1.08. After which a possible bearish target will be 1.06.

Do also look out for the regions indicated by the bollinger bands.

Fundamental Analysis

In the previous weekly review I cautioned on the uncertainty of the situation. Together with the low volume condition of the year end market, currency pair price action may often be unexpected. It is in this light that the EUR/USD turned bullish to the surprise of many. It was reported that while the European Central Bank did lower interest rate, it was not as much as expected. Furthermore there was no expansion to the quantitative easing program. These probably took out the short pricing of the market which was anticipating more measures.

On a side note, the US Non-Farm Payroll was slightly better than expected. This likely brought about more expectations of an interest rate hike. In the coming days, we need to keep this in mind.

In view of the absence of any major fundamental shift, the current moves may be mere sentimental reactions.

Do continue to be prudent and always practice proper money management. I am not in any position for now as I am still monitoring the price action.