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EUR/USD Price Forecast – Euro Sinks to Kick Off The Week

By:
Christopher Lewis
Published: Oct 3, 2022, 13:24 UTC

The euro tried to rally at the beginning of the Monday session but gave up gains yet again as the general slump continues.

Euro FX Empire

In this article:

Euro vs US Dollar Technical Analysis

The Euro initially tried to rally on Monday, but gave back gains to show signs of weakness. Ultimately, this is a market that looks as if it is going to continue slumping, which makes quite a bit of sense considering all of the negatives that we have for the EU. The Euro will continue to be beaten up by the interest rate differential between the two currencies, but there are fundamental economic situations in the European Union that has to be thought through.

For example, we have a major problem with energy in the European Union, due to the fact that natural gas lines are randomly exploding across the continent, while America now is going to step in and provide LNG. (At least they claim they are going to.) That being said, the Americans cannot provide the type of volume that the Europeans will need. Some conservative estimates say that a 20% reduction in natural gas compensation will need to be done this winter in order to keep things going. This is horrible for industry, and therefore I think it’s probably only a matter of time before we see an even weaker European economy.

Furthermore, the 50-Day EMA sits at the parity level, and is getting ready to slice through it. The Euro is very weak, and in fact has never recovered from the Great Financial Crisis. At this point, the Euro has shown why it will never be the world’s reserve currency, despite the fact that a few years ago people had come up with that idea. Ultimately, it all leads back to the US dollar, and that’s exactly what we are seeing on this chart.

EUR/USD Price Forecast Video for 04.10.22

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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