Euro opens strong as pro-EU Macron wins French election

Markets overall positive as Macron wins the French election on Sunday defeating Marine Le Pen, who threatened to take France out of the European Union.

The takeaway marks a continued stability in the Euro Zone and Euro currency in general. However, the Euro is still counter-acted by a strong Dollar especially given last week’s Non-Farm Payroll figures. Payrolls increased by 211K and the unemployment rate dropped to 4.4%.

For this week’s FX plays, we observe the market setups as follows.

EURUSD 1-Day

Currently, the EURUSD pair is still ranging on the daily time-frame. We can expected to ride any uptrend movements up until the next major resistance level at the 1.114~ price level.

EURUSD 30-Minute

Meanwhile, taking a look at the shorter time-frame, EURUSD quickly filled the gap open. This signifies that we are looking a short-lived bullish sentiment. If this pair crosses below the last Friday’s close, I would still be hesitant to switch to a bearish stance. We still have to consider that this pair was in an hourly consolidation since end of April and finally broke out on May 4th. After the break-out above, the zone turned from a resistance to support already giving one successful retest.

AUDUSD 1-Hour

While the gap up on EURUSD quickly filled resuming a bullish Dollar stance, I took a similar entry over on AUDUSD. This trade is kept to a very short-term play since AUDUSD is retracing off another hourly resistance, but it isn’t as strong given the choppy sell-off. The second point of concern is the relative strength index. Despite a very choppy nature and even to the point of lower lows, the RSI is marking higher and higher gains.

GBPUSD 1-Hour

GBPUSD remains a monitor for now especially given this uptrend. I am looking to go long once this pair retraces further preferably to the 1.495~ price level, which sits just above the resistance turned support zone. In fact, I wouldn’t call it much of a resistance zone since it was only tested once. I marked it as a key zone to watch, nonetheless, just given that it marked a change in decision point.

EURJPY 15-Minute

Meanwhile, we observe EURJPY returning the market open gap. This is another indication that the Euro gap up is short-lived and the election results continue to mark short-term optimism.

These are currently the pairs I’m monitoring at the moment. I am expecting closer to the London session we will begin to see a better Dollar, Euro, and Yen sentiment.

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