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EUR/USD Forecast – Euro Continues to Chop Around

By:
Christopher Lewis
Published: Feb 23, 2024, 14:22 GMT+00:00

The euro has been noisy during the early hours on Friday, as we continue to see a lot of noisy and uncertain behavior around the world.

In this article:

Euro vs US Dollar Technical Analysis

The Euro rallied slightly during the early hours on Friday, but keep in mind Thursday had seen this action as well, and in fact, was even more emphatic in its bullish pressure, only to turn around and give it up. At this point, it looks like there are a lot of headwinds, especially near the 1.09 level. So, I don’t think the Euro is about to take off.

I think it is just a continuation of the overall grinding nature of this currency pair and the fact that both central banks are coming into play on the soft side. So, if they both start cutting rates, or at least they’re going to be dovish this year, then there’s no real reason to run to one currency or the other, all things being equal. Keep in mind that the US dollar is considered to be a safety currency, so if we get some type of major risk-off type of attitude, that could change things.

But as things stand right now, this is a market that’s just drifting back and forth trying to find its way. And unfortunately, I think that might be how the majority of the year plays out. There’s really no reason for one to do better than the other. You have people speculating that the Fed is going to cut and the Fed even saying so. But at the same time, you have Germany in a recession and therefore the ECB sooner or later will have to pay attention to that.

So, with that being said, I think you may be looking at a range between 1.10 and 1.07 or so for the foreseeable future. That of course can change with plenty of other things going on around the world in a geopolitical sense. But at this point in time, it looks like we just don’t have anywhere to be. If you’re a short-term trader, this probably works out for you, but you’re talking about trying to pick up 20 pips, 30 pips or so at a time. You’re not talking about big moves here.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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