EUR/USD Weekly Forecast – Euro Struggles With the 50-Week EMA

EUR/USD Forecast Video for 05.12.22

Euro vs US Dollar Weekly Technical Analysis

The Euro has gone back and forth during the course of the week as we continue to see a lot of questions asked about what the Federal Reserve may or may not do. Quite frankly, it seems like the market is doing everything it can to ignore the fact that Powell suggested that rates were going to be higher for longer than anyone thought, but I digress. At this juncture, it looks like they are trying to sell off the US dollar under any circumstance, and that of course has a major impact on the Euro itself.

Having said that, we have seen quite a bit of an overextension, and at this point it might be ready for a bit of a pullback. The 50-Week EMA at the 1.05 level of course has a significant amount of influence, so with this being the case it’s possible that we could see a move back down to the 1.03 level. If we break down below 1.03 level, then we could see an even deeper correction.

This has been a very strong move, but when you look at the longer-term charts, we are still very much in a longer term downtrend, so it does make a certain amount of sense that we would see this through the prism of a short-term bounce. While things have gotten very positive for the Euro, the reality is that the longer-term outlook for the European Union still remains poor at best. With this, it’s likely that we see a bit of noise over the next couple weeks. In this scenario, be careful.

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