EUR/USD Forecast – Euro Continues Lackluster Movement

Euro vs US Dollar Technical Analysis

The euro has been somewhat sideways over the last several weeks, and therefore I think it’s going to continue to do more of the same as we are waiting on the Federal Reserve. The Federal Reserve of course will have a lot to do when it comes to where we go, mainly due to the fact that the US dollar will be so heavily influenced. As we are in the middle of a larger consolidation area, the 1.10 level above is a ceiling. Underneath the 1.07 level is a significant support level. We are dead set in the center, and it does make a certain amount of sense that we don’t have anywhere to be. That being said, I do have a use for this pair.

Quite often, I will use the EUR/USD pair as a signal as to where the US dollar is going to go. After all, it’s the largest part of the US Dollar Index, so if the Euro starts to drive higher against the US dollar, as a general rule you will see the US dollar falling in other places. Obviously, the exact opposite is also true. As things stand right now, it has become more or less a secondary indicator, but if we do get close to the extremes of the consolidation, meaning the 1.10 level or the 1.07 level, and show signs of failure to break out, then it sets up a nice trading opportunity to play the range yet again.

With both central banks likely to cut rates this year, I don’t think this is going to be a very lively pair most of the time, so therefore it’s a little bit lackluster and I am somewhat ambivalent at this moment.

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