EUR/USD Price Forecast – Euro Continues to Plunge

The Euro has fallen rather hard during the trading session on Wednesday to plunge below the 1.13 level. We have bounced a bit earlier in the US session, but we are already starting to roll right back over at this point. I initially had a target of 1.1250 with the pair, but it is possible we may break through that and continue to go even further to the downside. Ultimately, the one thing that you can take away from this chart is that you should not be trying to pick up this market, because quite frankly it would be tantamount to “catching a falling knife.

EUR/USD Video 18.11.21

Because of this, I think any rally will more than likely find plenty of selling pressure, opening up the possibility of fading rallies going forward. As far as a target is concerned, the way we are plunging it would not surprise me to see this market eventually go looking towards 1.10 level underneath. The European Central Bank has made it clear that they are dovish still, while the Federal Reserve is looking to taper bond purchases.

In other words, the monetary policy of the two central banks is starting to diverge, which of course is a very clear signal as to where we are going over the longer term. Ultimately, I have no interest in buying this pair, at least not yet and therefore on simply looking at signs of exhaustion on short-term rallies as ways to add to an already heavy short position that I have going in this market.

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