EUR/USD Forecast – Euro Gets Hammered Yet Again

EUR/USD Forecast Video for 28.09.23

Euro vs US Dollar Technical Analysis

The euro fell hard during the trading session on Wednesday, as we are continuing to see US dollar strength in general. Ultimately, this is a market that I think you need to look at through the prism of a major breakdown, and of course a major trend change. While the euro reached the 61.8% Fibonacci level from the overall selloff a couple of months ago, it’s pretty much been a straight line lower. Furthermore, we also have a potential “death cross” above, meaning that the 50-Day EMA is starting to break below the 200-Day EMA indicator, setting up a potential breakdown from a longer-term standpoint as well.

At this point, it looks like the euro is going to challenge the 1.05 level, which obviously is a large, round, psychologically significant figure. If we were to break down below there, then it’s likely that we could go down to the parity level and at this point, I don’t see anything that will keep that from happening. This is not to say that we won’t get some type of bounce, just that the sellers are certainly quite a bit more aggressive than the buyers, and there are a lot of concerns about a recession in the European Union. As long as there is concerns about Germany, France, and the other parts of the European Union slipping into a recession, it does make quite a bit of sense that the currency will continue to struggle.

On the other side of the Atlantic Ocean, you have the Federal Reserve, which although had recently held firm with its interest rate decision, the reality is that the Fed is likely to hike rates at least one more time, and there is also the very likely possibility that they are going to stay tight for quite some time, so therefore it does make quite a bit of sense since we will continue to see money flow from Europe to the United States as it’s treated better in that country. With this, I wait for signs of exhaustion after short-term rallies to take advantage of “cheap US dollars” going forward. I have no scenario in which I’m a buyer at the moment.

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