EUR/USD Price Forecast – The Euro Plunges Again

Euro vs US Dollar Technical Analysis

The Euro has fallen quite a bit over the last couple of trading sessions, testing the 1.02 level by the time New York got involved on Monday morning. Ultimately, if we break down below this area then it’s likely that we will test the crucial 1.01 level. Anything below there opens up the possibility of this market dropping down to the parity level. The parity level would of course have a lot of psychology attached to it, especially as we have seen a nice bounce from there. If we break down below there, then it’s likely that we continue to go much lower, perhaps down to the 0.98 level.

The European Union continues to suffer at the hands of a lot of negativity because quite frankly this winter we don’t even know whether or not the Germans are going to have enough power. With that being the case, it’s difficult to get overly bullish on the Euro and the European Union in general. The ECB is almost certainly going to have to remain very dovish, while the Americans are doing everything they can to fight inflation. In fact, the most recent ECB meeting suggested that even though the central bank did a little bit of tightening, they also mentioned that they were going to remain very loose.

In other words, it was more or less a move for show than any type of actual quantitative tightening. Financially speaking, the European Union is a bug looking for a windshield right now. Sooner or later, it’s going to find out windshield, and currency traders have been pricing this and for quite some time.

EUR/USD Price Forecast Video for 16.08.22

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