EUR/USD Price Forecast – Euro Continues to ConsolidateThe Euro initially tried to rally during the trading session on Monday but has given back the gains in early trading.
The Euro initially tried to rally during the early hours on Monday but has given back early gains to show signs of hesitation. At this point, it looks like the market is trying to figure out what to do with the 1.20 level. Quite frankly, the attitude in this pair is starting to shift the bed, mainly due to the fact that it looks like the United States economic numbers are better than originally anticipated, and of course the European Union is much worse. Compounding this issue as the fact that the vaccination situation in the EU seems to be stalling, which has a major influence on how people feel about the next leg of economic growth or contraction.
EUR/USD Video 09.02.21
Just below we have significant support extending all the way to the 1.19 level. It is on a break of that level that I think the Euro has significant problems. In the meantime, I would anticipate that we do a lot of back and forth in this area as we try to decide whether or not we are going to break down or turn around and recover. So far, it is a bit difficult to tell because quite frankly we are at such a crucial juncture. In the short term, I would anticipate that we are going to get a lot more in the way of range bound tight trading than anything else and that is exactly how I would play this market. We are still technically in an uptrend, so that cannot be forgotten, but it is worth noting that the 50 day EMA seems to be sloping lower over the last couple of days, perhaps signaling that there is more trouble to come.
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