EUR/USD Forecast – Euro Continues to Show Hesitation

Euro vs US Dollar Technical Analysis

It looks like the Euro is trying everything it can to break higher, but ultimately is struggling in the region on previous support. This market memory comes into the picture and puts a little downward pressure on the euro as traders will continue to meet at this area that has been like at a crossroads over the last several weeks. Longer-term traders are looking to short this market, while momentum traders are long.

So, I think at this point it’ll be interesting to see how this plays out. If we break below the 1.07 level, I think this is a sign that we drop and perhaps go looking to the 1.06 level. On the other hand, if we can break above the 50 day EMA, then we could go looking to the 1.0850 level.

All things being equal, this is a market that continues to be very noisy and choppy. But that does make a lot of sense considering that the central banks are both expected to cut sometime in the next year. But ultimately the ECB is probably going to be cutting sooner than the Fed, probably much sooner. And on top of that, you have to keep in mind that there are a lot of geopolitical concerns out there that could cause the US dollar to strengthen.

So that would be a continuation of the negativity. The 1.06 level underneath is a support level. If we break that, then it opens up a move down to the 1.05 level. If we were to somehow break above the 200 day EMA, then it opens up the possibility of not only 1.0850, but it also could send the market going all the way to the 1.10 level above.

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