EUR/USD Daily Forecast – Support At 1.1800 In Sight

EUR/USD Video 25.03.21.

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

EUR/USD is currently trying to settle below the support at 1.1830 while the U.S. dollar continues to gain ground against a broad basket of currencies.

The U.S. Dollar Index has managed to get above the resistance at 92.50 and is slowly moving towards the next resistance level which is located at 92.70. If the U.S. Dollar Index gets to the test of this level, EUR/USD will find itself under more pressure.

Yesterday, EU reported that Euro Area Manufacturing PMI increased from 57.9 in February to 62.4 in March compared to analyst consensus of 57.7. Euro Area Services PMI grew from 45.7 to 48.8 compared to analyst consensus of 46. While the reports exceeded analyst expectations, they failed to provide support to euro as foreign exchange market traders remained focused on the current problems with coronavirus in Europe.

Belgium has recently announced additional lockdown measures in order to fight against the third wave of the virus, joining other European countries who have extended current restrictions or introduced new ones. In this light, it remains to be seen whether recent improvements in the Euro Area services segment will be sustainable.

Technical Analysis

EUR/USD is currently testing the support level at 1.1830. In case EUR/USD settles below this level, it will head towards the next support at 1.1800. RSI remains in the moderate territory, and there is plenty of room to gain additional downside momentum in case the right catalysts emerge.

If EUR/USD declines below the support at 1.1800, it will move towards the next support level at 1.1750. A move below the support at 1.1750 will push EUR/USD towards the next support at 1.1720.

On the upside, EUR/USD needs to get back above 1.1830 to have a chance to develop upside momentum in the near term. The next resistance level for EUR/USD is located at 1.1850. If EUR/USD gets above this level, it will head towards the resistance at 1.1880. A successful test of this level will open the way to the test of the resistance at 1.1900.

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