EUR/USD, GBP/USD and EUR/GBP Forecast – Dollar a Touch Mixed in Tuesday Trading

EUR/USD Technical Analysis

The euro has rallied slightly against the U.S. dollar during early trading on Tuesday, but we are still in that same area that has caused a few headaches. So, it will be interesting to see if this actually matters. The 50-day EMA sits at 1.1621, and the 1.17 level above continues to be a major barrier as well. Quite frankly, this is a market that’s been doing nothing but dropping since the FOMC made its first rate cut in September, and I don’t see this pattern changing much. This is a market that I think, given enough time, will probably go looking at the 200-day EMA.

GBP/USD Technical Analysis

The British pound has fallen a bit in the early hours of Tuesday as the 1.32 level continues to be a bit of a barrier. We have bounced since then, so it will be interesting to see how this plays out. The last couple of hours have seen the U.S. dollar soften, so another attempt at 1.32 looks likely. Whether or not we can break above there remains to be seen. I’m still bearish on this pair, but it does make sense that we might just hang out for a while, as we had seen a pretty strong move to the downside.

EUR/GBP Technical Analysis

The euro has rallied quite nicely against the British pound as we continue to see a lot of back-and-forth action here. Pullbacks continue to attract value hunters, and the 0.8750 level—an area that previously had been resistance—now looks as if it should offer support. Whether or not we can continue to go much higher remains to be seen, but the measured move of this last consolidation suggests that we could go looking to the 0.89 level, an area that was an extreme high back in early 2023. A breakdown below the 50-day EMA, of course, would be negative, but we’re nowhere near that at the moment.

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