EUR/USD Forecast – Euro Continues to Stutter

Euro vs US Dollar Technical Analysis

The Euro has done very little against the US dollar on Tuesday. The market is currently treading water around the 50-day EMA, but what I’m starting to notice here is that the market is running out of momentum.

That, of course, is worth paying attention to, especially as we have not only the 50-day EMA and the 200 day EMA hanging around. With this being the case I think if we start to drift a little lower from here, then it could lead to more selling. At that point I would anticipate the 1.07 level could be a target and then after that we could be looking at the 1.06 level, while to the upside there is the possibility that if we can break above the top of the candlestick for the Friday session, then it opens up a possibility of a move to the 1.0870 level.

Ultimately, this is a market that I think continues to see a lot of choppiness more than anything else, and at this point in time, signs of exhaustion are going to be jumped on by the market. I think especially if US interest rates start to rise again, you will start to see more of the strength of the US dollar. And this point in time at least, is what I’m expecting. Again though, if we can break above the candlestick from last Friday, then it would obviously be a very bullish sign and it could change the narrative. But as things stand right now, the European Central Bank is expected to cut rates sooner than the Federal Reserve, and I think that’s a big driver here.

For a look at all of today’s economic events, check out our economic calendar.