EUR/USD Forecast – Euro Continues to See Volatile Consolidation

EUR/USD Forecast Video for 20.11.23

Euro vs US Dollar Technical Analysis

The euro has gone back and forth during the course of the trading session on Friday, as we continue to try to digest the overall shot higher that we had seen on Tuesday. Whether or not we can continue to go higher remains to be seen, but the 1.09 level above is a significant barrier that if we were to break above it, then we could go much higher. In that environment, I would anticipate that the euro would go looking to the 1.10 level above. After that, then we could have a longer-term move to the upside.

On the other hand, if the market were to break down below the 1.08 level, then it’s likely that we could drop down to the 200-Day EMA, which is the top of the previous bearish flag. That should have a lot of support just waiting to happen, so it’ll be interesting to see if we get down there and how the market reacts. That being said, it’s likely that we will continue to see a lot of choppiness until we get some type of fundamental reason. All things being equal, this is a market that continues to see a lot of noisy behavior just waiting to happen as both of these economies very well could be heading into a recession.

There is a lot of hope that the Federal Reserve is going to start loosening it’s monetary policy, or at least stop raising rates. That being said though, the reality is that the ECB is probably likely to cut rates much quicker than the Federal Reserve, despite the fact that the inflation numbers in the United States are starting to drop again. After all, the ECB is going to have to deal with Germany, Austria, and several others already dropping into recession. With that being said, I think we continue to see a lot of noisy behavior and uncertainty at this point, and therefore think you have to trade accordingly. While I recognize that there have been a serious amount of shots fired at the US dollar, the reality is that there are still plenty of fundamental reasons to think that perhaps this could turn around.

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