EUR/USD Forecast – Euro Continues to Sit on Top of the 50-Day EMA

EUR/USD Forecast Video for 06.07.23

Euro vs US Dollar Technical Analysis

The euro has gone back and forth during the course of Wednesday trading, as we continue to hang around the 50-Day EMA and the 1.09 level. The euro continues to see buyers underneath, and it looks as if we are in the midst of forming some type of bullish flag, and therefore I think it’s probably only a matter time before we take off. The 1.10 level of course is a large, round, psychologically significant figure, and I think will attract a lot of attention. If we were to break above there, then it could go looking to the 1.11 level after that.

If we break down below the 50-Day EMA, then it’s possible that we could drop down to the 200-Day EMA, near the 1.0750 level. The 200-Day EMA is an indicator that a lot of people will use to determine the overall trend, so a lot of people will be paying close attention to it. Furthermore, you also have to look at this through the prism of trying to find value above that level, and as long as we can stay above there, then I think we continue to have noisy but slightly positive behavior.

The European Central Bank and the Federal Reserve both are very tight with monetary policy, and both are very likely to continue raising rates. Because of this, we will continue to see a lot of noisy behavior and essentially the market “treading water” as we try to sort out which direction we are going to go over the longer term. Ultimately, I think you need to look at this through the prism of some type of range bound market, and therefore if you have the ability to trade back and forth on short-term charts, that might be the best way to go about dealing with the euro at the moment. That being said, if we do see a bigger move, then it’s possible that we could follow it, but right now it looks like we are basically hanging around and waiting to see which direction we are going for the longer term.

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