EUR/USD Price Forecast – Euro Recovers on Wednesday

The Euro rallied nicely during the trading session on Wednesday, getting back some of the losses from the Tuesday session. That being said, the market is likely to see more volatility, as the Euro is that extended levels. That being said, the 1.15 level of course is going to attract a lot of attention, as it is a large, round, psychologically significant figure. To say the least though, the Euro has been overbought and at this point the question comes down to what the ECB is getting ready to do. Quantitative easing is a real possibility, and the fact that the market has shifted so much in favor of the Euro could cause major disruptions.

EUR/USD Video 12.03.20

There is going to be fiscal stimulus coming out of the United States as well, so that obviously has its own issues. However, as far as funding is concerned, it’s likely that the US dollar will still continue to be desperately needed by economies around the world. The question then becomes whether or not that dollar demand sends this market much lower. The 1.1250 level underneath is massive support, and if we can break down below there it’s likely that the market goes looking towards the 200 day EMA underneath at the 1.11 handle. A break down below there would then open up the door to the 1.10 level. Alternately, if we break above the 1.15 handle, then the market is likely to go looking towards even higher levels in the form of 1.1750. One thing is for sure, we are certainly in a position where the market has come too far in too short of a period of time, so it would make sense that some type of pullback as necessary.