EUR/USD Forecast – Euro Continues to Rally Against the Greenback
EUR/USD Forecast Video for 13.01.23
Euro vs US Dollar Technical Analysis
The Euro has rallied a bit during the trading session on Thursday, breaking above the psychologically important 1.08 level. If we can stay above here, that would obviously be a very bullish sign, perhaps opening up a move to the 1.10 level. The Consumer Price Index came out in the United States right as expected, and therefore traders started to price in the idea of a 25 basis point rate hike for February. Remember, there was expectations out there that the Federal Reserve is going to raise interest rates 50 basis points in February, so that’s part of what this reaction is.
At this point in time, the Euro does look like it’s going to continue to go higher, but if we get a reversal rather quickly, that could be a sign that we have overshot. Either way, it’s obvious that the Euro is the consensus long at the moment, and therefore I think you have a lot of people jumping into the market. At this point, it’ll be interesting to see how things play out once we get through the next couple of days, if we were to turn around and break down below the 1.07 level, that would be extraordinarily bearish, but right now it does not look as if that’s going to be the case without some type of push.
It’s worth noting that we recently formed the so-called “golden cross”, so a lot of people like the idea of buying and holding. Nonetheless, that’s an indicator that happens way too late for my liking. At this point, it looks as if the Euro has plenty of momentum.
For a look at all of today’s economic events, check out our economic calendar.