EUR/USD Forecast – Euro Rallies Significantly

EUR/USD Forecast Video for 28.07.23

Euro vs US Dollar Technical Analysis

The ECB is in focus during the trading session on Thursday, as the ECB has an interest rate hike on the table. With that being the case, it looks like the euro will get a little bit of a booze, but this is just simply a continuation of the overall uptrend, and it looks like the euro will go looking to reach the 1.1250 level, an area that has been important a couple of times. All things being equal, the market could then move much higher. Underneath, we also have the 50-Day EMA in the picture, hovering around the 1.10 level. All things being equal, this is a situation where any pullback will more likely than not offer a bit of a buying opportunity based on value.

The 50-Day EMA underneath will offer quite a bit of support, and therefore if we were to break down below there, then it’s possible that the 1.09 level could come into the picture. That being said, I don’t see that happening unless of course the ECB puts out a very dovish statement, which of course will come down to perception more than anything else. It seems like the trading public is doing everything it can to push against the US dollar, so I think that a dip will more likely than not open up a buying opportunity.

Once we break above the 1.1250 level, then the market almost certainly will go looking to the 1.15 level. The 1.15 level historically has a lot of importance attached to it, and therefore I think could be very difficult to break above. By then, we will need to see some other fundamental reason to continue the upward movement, but first thing is first, and it’s all about overcoming the hurdle in front of us. Pay attention to interest-rate differential, and of course the bond markets as they give you a “heads up” as to which currency will be more attractive. With this, momentum still is on the side of the Euro, and I think that probably continues to be the case in the short-term, and possibly even in the longer term. That being said, if we get some type of financial shock, this pair will unwind.

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