EURUSD: Massive interest rate hike gave only a less than impressive rally

Even though ECB hiked interest rate by 75 basis points last week, EURUSD did not stage an impressive rally. This small upwards move also happened to be when there are signs of profit taking from those who have US Dollar long positions. Therefore, this is not a good pair to trade long next week even if DXY falls further downside. There are other pairs which can perform better in that case.

If DXY goes into upwards correction, this is a pair we can look for short setups. If US CPI data comes positive for the US Dollar, EURUSD can even fall further. However, I have no interest in holding long term sell positions for this pair either. In other words, this is a pair only for scalpers, for next week.

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Amir is a graduate in International Economics. He has been active in the financial markets since 2014.

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