EUR/USD Price Forecast – Euro Breaks Down From Highs

The Euro has fallen a bit during the trading session on Friday, as we may have gotten a little bit stretched. At this point though, it looks very much like a bit of a pullback into more buying pressure, as we may have gotten just a bit ahead of ourselves recently. With this being the case, I like the idea of taking advantage of value as it occurs. I recognize that the 1.21 level is backed up by the 50 day EMA, so that might be an area where buyers return. If they do, then I anticipate that the next move will be back to the upside. However, if we break down below the 1.21 handle it is possible that we could go looking towards 1.20 level, the next major round figure and an area that of course has been supported in the past. All things been equal, this comes down to the US dollar more than anything else.

EUR/USD Video 31.05.21

We do recognize as a market that the European situation is getting better and that is part of what has been driving this pair recently. That being said, a little bit of profit-taking makes sense as well, so at this point in time I believe that the market is going to continue to see more of a” backup and fill” type of scenario. Given enough time, I think that we are looking at an attempt to get to the 1.23 handle, and if we can break above there then it opens up the possibility of a move to the 1.25 level which is my longer-term target for later this summer, or perhaps even into the fall.

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