EUR/USD Forecast – Euro Likely to Grind Back And Forth

Christopher Lewis
Updated: Apr 22, 2024, 13:21 GMT+00:00

The euro has gone back and forth over the course of the last 12 hours or so, but it looks as if we see a lot of downward pressure, but not in a panic.

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Euro vs US Dollar Technical Analysis

The Euro initially tried to rally early during the session on Monday but has given back those gains. And it looks as if we are going to continue to see a lot of pressure. All things being equal, this is a market that I think has a lot of resistance in the form of the 1.07 level above and therefore, I think this is a market that still looks like a fade the rally type of situation.

If we can break above there, then it’s possible that we could go looking into the 50 day EMA, where I expect to see even more resistance. In general, this is a market that I think will continue to see a lot of noise, and if we can break down below the 1.06 level underneath that has been offering support, it’s possible that we will drop down to the 1.05 level.

Keep in mind that the European Central Bank is likely to cut rates in the next few months, and therefore that does put downward pressure on the euro, while at the same time the Federal Reserve is likely to stay tight with its monetary policy for a while. So, with that being said, it’s likely that we will continue to see downward pressure.

But I don’t know if we see some type of massive selloff. After all, this is a market that I think is more sideways than anything else with more of a downward twist. So, I fade short term rallies that show signs of exhaustion, but I don’t hang on to the position. It would not surprise me at all to see this market consolidate in a larger pattern over the rest of the year.

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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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