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EUR/USD Forecast – Euro Continues to Reach Higher

By:
Christopher Lewis
Published: Nov 20, 2023, 14:47 GMT+00:00

The Euro rallied a bit during the early hours on Monday, as it looks like we are trying to continue the overall uptrend.

Euro, FX Empire

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EUR/USD Forecast Video for 21.11.23

Euro vs US Dollar Technical Analysis

The euro has rallied again during the early hours on Monday, as we continue to see the US dollar take a little bit of a beating. At this point, we are reaching a significant resistance barrier, and are also in the vicinity of a previous uptrend line that could offer a little bit of resistance. That being said, the market is likely to continue to see traders try to sort out whether or not the Federal Reserve is going to step away from the tightening policy that they have been in for some time.

While I believe it is a little early to celebrate, there is the possibility that the Federal Reserve is at least going to step on the sidelines, which might work against the US dollar, but at the same time the European Union is heading into a major recession, and the ECB is almost certainly going to have to loosen monetary policy quicker than the Federal Reserve, so we could get a significant turnaround given enough time. All things being equal, the market is likely to continue to see the volatility pickup, not drop, and this overextended run is a little dangerous at this point in time, so at the very least a pullback could be coming into the picture. The 1.10 level above is a potential short-term target, but it’s also a large, round, psychologically significant figure that people will be paying close attention to.

Conversely, if we break back down below the 1.08 level, that would be a very negative turn of events, and then it’s possible that we could signify something more along the lines of the selloff instead of a short-term pullback. In general, this is a market that I think continues to be noisy, but right now we are trying to break above a resistance barrier that has been important previously. Furthermore, the 50-Day EMA is starting to reach toward the 200-Day EMA, kicking off the potential “golden cross” that could send this market higher. After all, it’s a very positive technical signal that a lot of people pay close attention to for the longer-term trend.

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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