EUR/USD Forecast – Euro Continues to See Support

Euro vs US Dollar Technical Analysis

As you can see, the Euro initially fell a bit during the trading session on Tuesday, but it looks like it is finding a little bit of support just above the 1.07 level, an area I’ve been talking about for some time. I think a simple bounce makes quite a bit of sense here, but I don’t necessarily think anything will have changed in the long run.

We are just simply bouncing around ahead of non-farm payroll on Friday. And the following week, we even get an ECB rate announcement, so I think it all comes together for a market that’s just killing some time. We’re a little oversold, we’ll get a little bit of a bounce. At this point, the 200-day EMA, essentially sitting at the 1.0825 level, would be a potential target, and if we can break above there, it could go as high as 1.10, where we see significant resistance and the top of the current consolidation area.

So therefore, I think a little bit of a trade is being set up. However, if we were to turn around and break down below the 1.07 level and do so when a daily close, especially if it’s after the jobs number, then you might see the euro drop down to the 1.05 level. Keep in mind, that both of these central banks are probably going to be cutting rates this year.

Both have to deal with economies that are somewhat schizophrenic. So, I think at this point, it’s difficult to own one currency over the other in the long term. I think a bit of tennis is being played on the charts right now, which makes it look like it’s time to start buying.

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