EUR/USD Forecast – Euro Drifts Lower

EUR/USD Forecast Video for 30.01.23

Euro vs US Dollar Technical Analysis

The Euro has pulled back just a bit during the trading session on Friday as it looks like we are finally getting a little bit overstretched again. Ultimately, I don’t know that anything has changed, just that the market has run out of momentum. However, I would keep a close eye on the previous 3 candlesticks, because they have long wakes to the bottom, and if those get broken it shows that we are ready for a deeper correction. Furthermore, the candlestick before those 3 is a shooting star, and we have yet to break above it. In other words, this is a market that has a lot of gravity coming into the picture all of a sudden.

While the ECB is talking about raising rates going forward, they have admitted that they are not necessarily sure where the terminal rate is, so while I wouldn’t say they are sounding dovish, but you could make the argument that the ECB has at least opened the door for changing policy. I think you will continue to see a lot of choppy behavior, so while we are most certainly in an intermediate uptrend, some type of shock to the system could be coming based upon a lot of things that I am seeing, and that could send people running back to the US dollar.

Will we hit the lows again? Probably not, but this year is probably going to feature more volatility, not less unfortunately. As things stand right now, a nice pullback and correction could be needed for the market to see another rush to the upside.

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