EUR/USD Price Forecast – Euro rallies to kick off the week

The Euro rallied a bit during the trading session on Monday, as traders came back to work from the weekend. I think at this point we are simply trying to square up all of our trades between now and the Jerome Powell statement after the Federal Reserve interest rate announcement. While widely expected to hike 0.25%, it’s the statement afterwards that will push the markets around. People are starting to doubt whether or not the Federal Reserve will sound as hawkish as previously thought, and if that’s the case it could be dollar negative. However, on the other side of the Atlantic Ocean we have a world of pain when it comes economic figures in the European Union, not to mention the fact that we have riots breaking out in several countries. This will economic conditions and huge discontent don’t make for a strong currency.

EUR USD Forecast Video 18.12.18

Because of this, I think this is a market that is simply waiting to see whether the Federal Reserve will surprise or not. If it does not, we could see this market range bound between now and the end of the year. Currently, I look at the 50 day EMA on the chart and the 1.15 level above as massive barriers for the Euro bulls to try to overtake. Otherwise, we will probably continue to fade rallies but I’m not expecting a substantial break down unless Jerome Powell specifically states that the Federal Reserve is going to continue a very hawkish path going forward.