EUR/USD Daily Forecast – Euro Moves Towards Yearly Lows

Support At 1.1660 In Sight

EUR/USD is currently moving towards the support level at 1.1660 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index has managed to settle above the resistance at 93.40 and is currently trying to get above 93.60. The nearest significant resistance level is located at the yearly highs at 93.75. If the U.S. Dollar Index continues to move towards yearly highs, EUR/USD will find itself under more pressure.

Today, foreign exchange market traders had a chance to take a look at Germany’s Consumer Confidence report for October. The report indicated that Consumer Confidence improved from -1.1 in September (revised from -1.2) to 0.3 in October compared to analyst consensus of -1.6. While the report exceeded analyst expectations, it failed to provide any support to euro as the U.S. dollar gained strong upside momentum against a broad basket of currencies.

Traders will also have a chance to hear the latest commentary from ECB as President Lagard and other ECB officials are scheduled to speak at the ECB Forum on Central Banking.

Technical Analysis

EUR/USD has recently managed to get below the support level at 1.1690 and continues to move lower. RSI remains in the moderate territory, and there is enough room to gain additional downside momentum in case the right catalysts emerge.

The next support level for EUR/USD is located near yearly lows at 1.1660. In case EUR/USD manages to settle below this level, it will gain downside momentum and head towards the next support at 1.1630. A move below this level will open the way to the test of the support at 1.1610.

On the upside, the previous support at 1.1690 will serve as the first resistance level for EUR/USD. In case EUR/USD manages to settle back above this level, it will head towards the resistance at 1.1720. A successful test of this level will push EUR/USD towards the next resistance which is located at the 20 EMA near 1.1750.

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