EUR/USD Forecast – Euro Slams Into Trendline
EUR/USD Forecast Video for 07.06.23
Euro vs US Dollar Technical Analysis
The euro has fallen again during the trading session on Tuesday, as we continue to see a lot of noisy behavior. All things being equal, this is a market that I think continues to see a lot of noise around this area, because not only do we have the trendline that has been in focus for some time, we also have the 200-Day EMA. Keep in mind that the 200-Day EMA almost always attracts a lot of attention, so this in and of itself will probably bring in volatility. Furthermore, we also have to pay close attention to the fact that Germany is heading into a recession, and that of course has a lot of people worried about the European Union in general.
Looking at this chart, is very likely that we continue to see downward pressure overall, and if we do break down below the lows of last week, then it’s possible that we could go down to the 1.05 level, the next large, round, psychologically significant figure. If we were to break down below that level, then it opens up a flood of selling and could send the euro much lower.
Alternatively, if we were to turn around and break above the highs of last week, then it’s likely that we could go looking to the 50-Day EMA, and then possibly even as high as 1.10 over the longer term. As things stand right now, it would be a bit difficult to see that, but it’s not an impossibility. With this being the case, I think you’ve got a situation where the market is likely to continue to see a lot of back and forth, but I do think that given enough time we will have to break out of this range. Once we do, it’s simply a matter of following whichever direction the market decides to break out toward.
Keep in mind that both the Federal Reserve and the European Central Bank have interest rate decisions next week, one day after the other. Because of this, we may have a lot of confusion in the short term but by the time we get to the end of next week, it’s very likely that we will have quite a bit more in the way of clarity.
For a look at all of today’s economic events, check out our economic calendar.