EUR/USD Tries To Settle Below The Support At 1.0780

Key Insights

• EUR/USD is moving lower amid concerns about the health of the European economy. 
• The U.S. dollar gains ground against a broad basket of currencies as demand for safe-haven assets stays strong. 
• A move below 1.0780 will push EUR/USD towards the support at 1.0760.

Euro Is Under Pressure Against U.S. Dollar

EUR/USD is currently trying to settle below the support level at 1.0780, while the U.S. dollar is moving higher against a broad basket of currencies.

The U.S. Dollar Index settled above the resistance at 100.50 and is trying to gain additional upside momentum. In case this attempt is successful, the U.S. Dollar Index will get to the test of the next resistance at 100.85, which will be bearish for EUR/USD.

The European currency remains under pressure as foreign exchange market traders are worried about the health of the European economy. The EU prepares a new round of sanctions against Russia, which may include sanctions on Russian oil.

Such sanctions would put additional pressure on the European economy and could cause a recession at a time when the ECB would be forced to raise rates due to rising inflation.

Technical Analysis

EUR/USD has recently managed to settle below the support level at 1.0810 and is trying to get below the next support level, which is located at 1.0780. RSI is in the moderate territory, and there is enough room to gain additional downside momentum in case the right catalysts emerge.

If EUR/USD declines below the support at 1.0780, it will head towards the next support level at 1.0760. A move below this level will open the way to the test of the support at 1.0730.

On the upside, EUR/USD needs to settle back above the resistance at 1.0810 to have a chance to gain upside momentum in the near term. The next resistance level for EUR/USD is located at 1.0850. In case EUR/USD climbs back above this level, it will head towards the next resistance level, which is located at 1.0865.

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