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EUR/USD Forecast – Euro Has Erratic Trading on Monday

By:
Christopher Lewis
Updated: Mar 20, 2023, 13:44 GMT+00:00

The Euro initially gapped to the upside, before falling rather significantly to pierce the 50-Day EMA. After that, buyers came back in and picked it back up.

Euro, FX Empire

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EUR/USD Forecast Video for 21.03.23

Euro vs US Dollar Technical Analysis

The Euro initially gapped to the upside to kick off the Monday session, but then plunged rather drastically to pierce the 50-Day EMA. The market then turned back around to show signs of life, as we are now starting to rally again. At this point, it becomes very obvious that the market is all over the place and will more likely than not continue to be. After all, there’s a lot of questions as to whether or not the Federal Reserve will raise interest rates this week, as we are starting to see questions about the banking system globally.

The market looks very likely to see a lot of volatility over the next couple of days with so many questions out there. The 1.08 level above should continue to be important, as marked on the chart. If we were to break above there, then it would obviously be a very bullish sign, but I think it’s probably only a matter of time before we would see exhaustion in that area. That will be especially true if the Federal Reserve sounds hawkish on Wednesday. Quite frankly, I think we are probably more or less likely to find some type of range at this point more than anything else.

The 50-Day EMA underneath is the first sign of support, but I believe that the 1.06 level is going to continue to be more important. Underneath there, we have the 200-Day EMA near the 1.0550 level, so anything that breaks down below that level would be a very negative turn of events for the Euro and would probably be accompanied by a lot of bullish pressure for the US dollar around the world.

Ultimately, this is a situation where you see a lot of noisy behavior, but I do think that given enough time we will probably come to some type of vigor move. I suspect it’s probably not going to be between now and the Federal Reserve meeting and statement. In the meantime, expect a lot of choppy behavior and therefore probably have to look at this through the prism of a short-term trading environment more than anything else.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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