EUR/USD: volatile end to the week suggests further movement

The EUR/USD has had a fairly positive end to the week and finishing off with a very volatile day today due to the nonfarm payrolls and other US economic news releases. The price is now sitting on the 200 EMA where it has formed a shooting star candlestick formation and is looking to drop.

The 4 hour chart suggests that a continuation downwards is a possibility. The price is currently sitting on the 200 EMA where it has given us a fairly bearish candestick formation, moreover, the RSI is heading into overbought territory. We will be looking to enter into a short position next week with the scope of it dropping back down to the inclining support line which is sitting just above the 1.0818 mark.

If the price does decide to move further upwards then it will target the previous high in February at 1.137. However, we are not expecting any large movement for the time being as the RSI is looking close to the overbought position and in order for the price to break the 200 EMA it will require a great deal of momentum.