EUR/USD Daily Forecast – Support At 1.1925 In Sight

Euro Remains Under Strong Pressure Against U.S. Dollar

EUR/USD is currently trying to settle below 1.1950 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index has recently managed to get above the resistance at 91.50 and gained additional upside momentum. Currently, the U.S. Dollar Index is moving towards the next resistance level which is located at 91.80. In case the U.S. Dollar Index gets to the test of this level, EUR/USD will get more support.

Yesterday’s Fed message was more hawkish then expected which provided significant support to the American currency. Fed members expect that rates will go up in 2023, which is a material change in expectations compared to previous meetings.

Today, foreign exchange market traders will have a chance to take a look at inflation data from EU. Analysts expect that Euro Area Inflation Rate increased by 0.3% month-over-month in May. On a year-over-year basis, Inflation Rate is projected to grow by 2%. Core Inflation Rate is projected to grow by 0.9% year-over-year.

Later, traders’ focus will shift to the job market data from the U.S. Initial Jobless Claims report is expected to show that 359,000 Americans filed for unemployment benefits in a week. Continuing Jobless Claims are projected to decline from 3.5 million to 3.43 million.

Technical Analysis

EUR/USD managed to get below the support at 1.1965 and is moving towards the next support level at 1.1925. RSI has just entered into the oversold territory, but there is some room to gain additional downside momentum in case the right catalysts emerge.

In case EUR/USD manages to settle below the support at 1.1925, it will head towards the next support level at 1.1900. A successful test of this level will open the way to the test of the support at 1.1880.

On the upside, EUR/USD needs to get back above 1.1965 to have a chance to gain upside momentum in the near term. The next resistance level is located at 1.1990. If EUR/USD gets above this level, it will move towards the resistance at 1.2020. A successful test of this level will push EUR/USD towards the resistance at 1.2040.

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