EUR/USD Price Forecast – Euro Pulls Back to 50 Day EMA

The Euro has pulled back a bit during the trading session on Friday to reach down towards the 50 day EMA, but as you can see is starting to see a little bit of support in that area. At this point in time, I think it is only a matter of time before we turn around and try to break out to the upside again, based upon the recent market structure and the fact that we had pierced the neckline of an inverted head and shoulders. Furthermore, the noise in the bond market settling down could be a major driver of where the US dollar goes, which of course has its influence on what we see here. That being said, I think it is only a matter of time before we try to reach towards the top of the recent consolidation area which is above the 1.23 level.

EUR/USD Video 1.03.21

Looking at the inverted head and shoulders, it measures for a move towards the 1.24 handle, which is right smack dab in the middle of the major resistance that I see between 1.23 and the 1.25 levels, and an area that I think is going to be very difficult to break out of. Having said that, most currency traders believe that we are going to continue to see the US dollar get hammered over the longer term, so I do think that we eventually get the breakout. I think it probably will take quite some time to get there, because the Euro tends to be very choppy under the best of conditions.

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