EUR/USD Price Forecast – Euro Dips But Finds Support

The Euro rallied after initially falling during the trading session on Tuesday, to turn around and form a bit of a hammer by the time New York got involved. It looks like the market is starting to move in trying to digest the gains overall. Ultimately, with the Federal Reserve starting the Tuesday meeting during the session on Tuesday, the Euro and the US dollar may move very little, perhaps trying to decide whether or not we are going to digest the gains and continue going higher, or if we are going to break back down. It will more than likely hinge on whatever the Federal Reserve says with that statement at the end of the meeting.

EUR/USD Video 10.06.20

One thing I would point out is that if the candlestick for the session on Tuesday gets broken to the downside, there could be a “pocket of air” underneath, opening up a move all the way down to the 1.1050 level where the 200 day EMA sits. The grind higher would be a bit more difficult, unless Jerome Powell specifically suggests that the liquidity measures in the Federal Reserve arsenal are going to be expanded.

Looking at this chart, it is likely that we will be quiet until that statement gets read at 2:00 PM New York time. At this point in time, it is probably going to be a choppy back and forth type of situation, and therefore there is not much to do until after that announcement. People will be looking for forward guidance when it comes to the US dollar via the Fed more than anything else. We are at the top of the overall range, so unless there is something extraordinarily dovish stated, we could turn right back around.

For a look at all of today’s economic events, check out our economic calendar.