EUR/USD Forecast – Euro Continues to See Choppy Behavior

Christopher Lewis
Updated: Jun 2, 2024, 10:10 GMT+00:00

Euro continues to see a lot of noisy behavior, but at this point in time it is obvious that the market will continue to more or less focus on the central banks at this juncture.

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Euro vs US Dollar Technical Analysis

You can see that we have broken down a little bit during the early hours on Wednesday, as it looks like the 1.08 level will be targeted as a potential support level. Ultimately, we have pulled back from the 1.09 level, an area that I thought could end up being a significant amount of resistance and it does, in fact, look like that ends up being the case. Now, whether or not we break through the 1.08 level is a completely different question.

So therefore, I would be remiss to suggest that perhaps it’s an automatic short here. I suspect more likely than not, that we will end up with a little bit of range bound trading. I personally don’t think that there is a whole lot of conviction at the moment. And with this, it makes sense that we just kind of drift around. Now, when you look at the longer term chart since the end of last year, we are progressively lower over time, but it’s been a very choppy affair. And that does make a certain amount of sense with both central banks likely to cut rates sometime between now and the end of the year.

Quite frankly, I think the European Central Bank is more likely to do it than the Fed in the short term. So that might be part of what you’re seeing, a little bit of realization of that coming. So, with that being said, let’s take a look at the 1.08 level as a potential entry area, be it long or short. We want to see how the market reacts to this very important level.

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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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