EUR/USD Forecast – Euro Continues to Drift Lower Overall

Euro vs US Dollar Technical Analysis

The Euro fell a bit during the early hours on Thursday again as it looks like we are going to do everything we can to reach the 1.07 level. With that being said I think you have to look at this through the prism of a market that is just simply reacting to the latest news coming out of the bond market. With that being said, I think you have to look at this as an area that could cause a little bit of a bounce.

But if we were to break down below the 1.07 level, then we could go down to the 1.06 level, maybe even the 1.05 level. Rallies at this point in time will probably be somewhat limited with the ECB more likely than the Federal Reserve to cut rates in the near future.

I don’t necessarily think that this is a market that’s going to collapse anytime soon. I just believe that it’s a market that’s probably favoring the downside. This is a pair that really doesn’t move that much most of the time, so you would anticipate more choppy behavior with maybe a bit of a downward tilt. If we did take out the spike higher from the Friday session of last week, then we could go to the 1.0875 level, but I’m not holding my breath on that one. Anything above there opens up 1.10, but we would have to get a huge risk on type of environment or a misstep coming out of the Federal Reserve to make that happen.

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