EUR/USD Forecast – The Euro Continues to Chop Back And Forth

EUR/USD Forecast Video for 31-01-2024

Euro vs US Dollar Technical Analysis

The Euro initially fell a bit during the trading session on Monday, only to turn around and show signs of life again. At this point, we are likely to continue to see the market try to get back to the 50-day EMA, but really at the end of the day, it’s more likely than not we are going to see just a return to the overall consolidation phase. The market has a couple of different consolidation barriers that you need to be aware of, not the least of which would be the 1.0750 level underneath, and the 1.10 level above. In the short term, I do think that the market seems to be very comfortable around the 1.0850 to the 1.0950 range, and I do think that the FOMC meeting and statement could be a major influence on where we go next. Maybe not so much with the euro, but the dollar.

Keep in mind that the ECB has to perhaps start cutting as well because Germany of course has entered a recession and therefore it’s likely that we will eventually see the euro lose some strength but right now I think we’re somewhat neutral. This is a good sign of what the entirety of the market is doing. There is a lot of just Brownian motion or what is known as motion that doesn’t get any traction, it just kind of grinds back and forth.

Ultimately, I do think this is a scenario where you are looking for some type of resolution to this very choppy pattern of the last couple of weeks. Either way, I think this is a scenario that’s probably not going to change in the short term. The pair does tend to be very noisy and sideways in general, so it wouldn’t surprise me at all if we trade in the bigger consolidation phase for most of the year at this point.

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