EUR/USD Weekly Forecast – Euro Continues to Search For Its Boundaries

EUR/USD Forecast Video for 22-01-2024

Euro vs US Dollar Weekly Technical Analysis

The Euro fell pretty significantly to kick off the trading week, only to turn around and show signs of life. At this point in time, it looks like the Euro is going to continue to consolidate in general, as we are between the 50 week EMA underneath and the 200 week EMA above. It seems as if the market is going to continue to hang around the 1.09 level, an area that we have seen the last three days of the week be like a magnet for price.

I think at this point, we continue to see a lot of questions asked about what the interest rate situation is going to be because quite frankly, most traders believe that the Federal Reserve is going to start cutting in 2024. But there are enough economic issues in the EU right now that the ECB is likely to start cutting in 2024 as well.

What that means is we are probably going to have some type of range. On the other hand, it’s worth noting that we are right around the 50% Fibonacci retracement level from the big move lower and because of that, there are a lot of different people jumping into the market in both directions. All things being equal, I think this is a market that is trying to carve out its range for the year, we just haven’t settled quite yet on what the boundaries are. Once we sort that out, then we will have plenty of opportunities, but right now it looks like longer term traders are going to have to sit on the sidelines and let the button pushers sort this out.

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