There are only a few expiry periods per day to consider, as explained in broad less.
This is for the EUR/USD pair with a large segment between 1.1650 and 1.1700. As things stand, key risks between the US and Iran continue to drive market sentiment and USD sentiment/trade with it. This is the tail wagging the dog, as traders start to feel more fearful again amid the lack of a breakthrough in the next round of talks.
There was some fake news related to Iranian missiles overnight hereBut that was enough to expose the risk-on rally that occurred earlier this week as a rather fragile rally at the end of the day. All it takes is a negative headline, and there’s a chance the whole thing will be undone.
So, we are seeing a more cautious mood there, and higher oil prices are also keeping traders coming back to the dollar for some time.
The above expiry periods for EUR/USD are settling around the 100 and 200 day moving averages, which are currently at 1.1674-05. Therefore, expiry periods may serve as another defensive layer in sustaining downward price movements in the next session.
But if the negative mood deepens, expect it to have a stronger control in terms of dictating price action. However, there is still a larger layer of expiry at 1.1650 which could still keep things in check. That is, at least until we get to US trading and more major risks that will follow from Washington and Tehran.
For now, the above-mentioned expiry periods may play a role – even if limited – as we work on Eurozone PMI data as well in the next session.
For more information about how this data is used, you can refer to this post here.
