EUR/USD Daily Forecast – Another Test Of Resistance At 1.1610

Euro Attempts To Gain More Ground Against U.S. Dollar

EUR/USD continues its attempts to settle above the resistance at 1.1610 while the U.S. dollar is losing some ground against a broad basket of currencies.

The U.S. Dollar Index is currently trying to get below the 94 level. If the U.S. Dollar Index settles below this level, it will gain additional downside momentum and move towards the support at 93.75 which will be bullish for EUR/USD.

Today, U.S. is projected to report that Factory Orders increased by 1% month-over-month in August. It remains to be seen whether this report will have a material impact on currency dynamics, and foreign exchange market traders may stay focused on general market sentiment.

Euro is currently trying to move away from yearly lows which is natural after the major sell-off. However, worries about higher inflation and the potential reduction of Fed’s asset purchase program may provide more support to the American currency in the upcoming trading sessions.

Technical Analysis

EUR/USD settled above 1.1580 and is trying to settle above the resistance level at 1.1610. This resistance level has already been tested several times and proved its strength. RSI remains close to the oversold territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

If EUR/USD moves above 1.1610, it will head towards the next resistance level at 1.1630. A successful test of the resistance at 1.1630 will push EUR/USD towards the resistance at 1.1660. In case EUR/USD manages to settle above this level, it will head towards the next resistance which is located at the 20 EMA at 1.1690.

On the support side, EUR/USD needs to get back below the support at 1.1580 to have a chance to develop downside momentum in the near term. The next support level for EUR/USD is located near the recent lows at 1.1560. A successful test of the support at 1.1560 will open the way to the test of the next support at 1.1540.

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