EUR/USD Price Forecast – Euro Continues to Chop Around Above 200 Day EMA

The Euro has rallied again during the trading session on Thursday as traders trying to figure out what to do with the US dollar. The stock markets have been absolutely crushed, so it has hurt the US dollar against most currencies, but at the same time the Euro is most certainly overextended. The 1.1250 level above should continue to cause a bit of a “ceiling” in the markets if the market were to break above there it could signal a longer-term trend change.

EUR/USD Video 06.03.20

The Euro continues to be a bit of a juggernaut, as we go back and forth but we are a bit overextended at this point. Sitting on top of the 200 day EMA, in theory it is a bullish run just waiting to happen but there is so much in the way of noise above that I believe it’s going to be extraordinarily difficult to deal with this figure unless of course the Federal Reserve continues to sound dovish and a bit hesitant. The biggest shoe to drop on the other side of the equation could be the European Central Bank doing something to loosen monetary policy, something that seems very possible at this point. Simply put, this is a market that has been trying to reestablish fair value after the interest rate cuts because the US dollar has enjoyed such a huge interest rate differential for so long. Because of this, the market is trying to figure out where things should be. That being said, the US dollar should lose value over the longer term but there is going to be the specter of the ECB doing something.