EUR/USD Price Forecast – Euro slams into trend lineThe Euro slammed into a downtrend line during the trading session on Tuesday as traders are beginning to digest the idea of even further trade tariffs between the American and China, which of course isn’t going to help much.
The Euro rallied initially during the trading session, but as China announced the more tariffs, the US dollar started to pick up steam due to traders jumping into the treasury market. The pair also had tested a downtrend line that has been causing some issues, so it’s likely that the pair will continue to struggle in this general vicinity. When I look at the hourly chart, I could see that we continue to see a lot of pressure in this area, so quite frankly none of this surprises me. What was surprising is that equities traders were looking to ignore the situation between the United States and China, but I think things are starting to get to the point where eventually it’s going to scare the market.
The alternate scenario of course is that we break above the 1.1725 level, which would be very bullish, perhaps sending the market towards 1.1750 level, and then the 1.18 level after that which is the top of the larger consolidation. However, I think that would take a lot of effort, much more effort than a short-term pullback would, so I suspect the short-term pullback is what we are about to see. If we were to break down below the 1.1660 level, then I think we would probably drop to the 1.1625 handle next. Otherwise, I think you can expect a lot of choppiness and general aggravation in this pair as it is highly congested with the US trade war agitating things, but then again things aren’t exactly great in the European Union either.