EUR/USD Daily Forecast – Euro Attempts To Move Higher At The Start Of The Week

Euro Gains Some Ground Against U.S. Dollar

EUR/USD has recently made another attempt to settle above the resistance at 1.1660 while the U.S. dollar was mostly flat against a broad basket of currencies.

The U.S. Dollar Index failed to settle below the support level at 93.50 and rebounded towards 93.60. The nearest resistance level for the U.S. Dollar Index is located at 93.75. In case the U.S. Dollar Index gets to the test of this level, EUR/USD will find itself under more pressure.

Today, foreign exchange market traders will focus on Germany’s Ifo Business Climate report for October. Analysts expect that Business Climate decreased from 98.8 in September to 97.9 in October.

On Thursday, the European Central Bank will announce its Interest Rate Decision, so traders may start to prepare for this important event.

ECB is expected to remain dovish and maintain its position that higher inflation is a temporary phenomenon. Interestingly, traders will have a chance to take a look at Euro Area inflation data on Friday, right after the ECB Interest Rate Decision. Euro Area Inflation Rate is projected to grow by 3.7% year-over-year in October while Euro Area Core Inflation Rate is expected to increase by 1.9%.

Technical Analysis

EUR/USD is trying to get above the resistance level at 1.1660. In case EUR/USD manages to settle above this level, it will head towards the next resistance level which is located at the 50 EMA at 1.1675.

A move above the resistance at the 50 EMA will open the way to the test of the next resistance level at 1.1690. If EUR/USD settles above 1.1690, it will move towards the next resistance level at 1.1720.

On the support side, the nearest support level for EUR/USD is located at the 20 EMA at 1.1630. In case EUR/USD declines below the 20 EMA, it will head towards the next support level at 1.1610. A successful test of the support at 1.1610 will push EUR/USD towards the support at 1.1580.

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