EUR/USD Forecast – Euro Has a Lackluster Recovery

EUR/USD Forecast Video for 17.03.23

Euro vs US Dollar Technical Analysis

The Euro has rallied a bit during the trading session on Thursday to break back above the 1.06 level. By doing so, the market suggested a little bit of bullish behavior, but after the absolute beating that the market took during the trading session on Wednesday, it’s difficult to imagine that the Euro will suddenly take off to the upside. Keep in mind that the 200-Day EMA offered support during the previous session, as we had broken through there only to turn around and show signs of life. If we break down below that candlestick, then it could open up a huge move to the downside.

On the other hand, if we were to somehow take out the top of the candlestick for the Wednesday session, then it would be a very bullish sign, but it would be very difficult to make that happen, as there is so much in the way of effort that would be needed. At this point, there are lot of traders out there that are worried about the global economy and whether or not we are going to continue to see strength. If that is going to continue to be a major feature of the market, it does make a lot of sense that we would see the US dollar continue to be attractive.

The bond market has been attracting a lot of inflows as of late, and that of course requires US dollars. Typically, when you see a massive candlestick like we saw on Wednesday, there is follow-through given enough time. In other words, I do think that you still have to believe that there are plenty of sellers out there willing to get involved. If we break down below the 200-Day EMA, then it’s likely that the 1.03 level could be a target, followed by the potential of dropping all the way down to the parity level.

If we do somehow break out to the upside, we could go as high as the 1.10 level, but that seems to be a bit of a pipe dream at this point in time. Ultimately, this is a market that continues to show a lot of volatility more than anything else.

For a look at all of today’s economic events, check out our economic calendar.