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EUR/USD Price Forecast – Euro Breaks Hard After Poor Economic Figures

By:
Christopher Lewis
Published: Mar 17, 2020, 13:46 UTC

The Euro got hit relatively hard during the trading session on Tuesday as the German ZEW Economic Sentiment numbers were -49.5, as opposed to -29.7 expected. The European ZEW Economic Sentiment number came out at -49.5 as well, much worse than the anticipated -23.1 for the announcement.

EUR/USD Price Forecast – Euro Breaks Hard After Poor Economic Figures

The Euro has broken hard during the trading session on Wednesday, slicing through the 1.10 level. At this point, the market is very likely to continue to go lower over the longer term but a little bit of a bounce from here would not be a huge surprise. The question now is whether or not we can substantially break down below the bottom of the range for Tuesday? If we do, then it opens up a move to the 1.08 level. Otherwise, the 1.10 level will be massive support with the 1.1250 level above being massive resistance.

EUR/USD Video 18.03.20

The Euro is notoriously choppy, and therefore a back-and-forth type of scenario should not be a huge surprise. All things being equal though, I think that the US dollar will be favored as the treasury market is attracting quite a significant inflow, and that of course drives up the value of the US dollar as it is needed to purchase them. If we do get more of a “risk on” type of situation, then we could go looking towards the 1.1250 level and perhaps even try to break above there. If we do, we could even go as high as the 1.14 level, possibly the 1.15 level but that seems to be very unlikely at this point, and I look at all rallies with a bit of suspicion in the meantime. The volatility continues to be off the hook, not only here but pretty much any other market that you look at.

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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