The EUR/USD closed Friday’s trading near the 1.07108 level, placing it in the middle of its one-week price range as financial institutions prepare for the upcoming days. The election results in France, set to be announced late tonight and into Monday morning, are expected to have an impact on the EUR/USD trading pair. Despite trading below the important 1.07000 ratio for a significant portion of the week with dynamic fluctuations, the currency pair managed to finish the week near the 1.07108 mark.
Day traders should be aware of the daily intraday volatility expected on Monday, following the results of the first round of voting. Financial institutions may have already sold off the EUR/USD in anticipation of the outcome. Support has held steady near the 1.06700 level, with resistance currently seen at 1.07500. Day traders should exercise caution, especially when using leverage, and be prepared for potential volatility in reaction to the French election results.
The upcoming U.S. 4th of July holiday will lead to lighter forex volumes towards the end of the week. However, traders will have three days to react to the French election outcome before U.S. institutions close, potentially leading to fast market conditions early in the week followed by calmer waters. Economic data will take a back seat to the sentiment shifts caused by the election results.
Speculators should approach short-term trading with caution, as the EUR/USD may be oversold according to many. Quick trades following technical trends may be tempting, but traders should be wary of fast reversals. The upcoming round of voting on July 7th could impact trading tomorrow, especially if the results do not provide clarity on the political situation in France. Traders should be prepared for potential momentum shifts if key support or resistance levels are tested early in the week.