Euro vs US Dollar Technical Analysis
The Euro has rallied ever so slightly during the trading session on Monday as we continue to see the Euro try to regain some footing. That being said, the market continues to favor the US dollar over all other currencies, so it is hard to imagine that the Euro is going to be any different. Because of this, and the fact that the ECB is stuck with a very soft economy, it does make quite a bit of sense that this pair continues to see sellers every time it tries to rally.
Just above, I see the 1.05 level as a logical area of resistance based upon the previous action and of course the psychology of big figures. In fact, the resistance barrier looks likely to extend to the 1.06 handle, so one should look at the entire area as a potential short just waiting to happen. I would short the pair based upon signs of exhaustion and take advantage of any opportunity that I get.
If we were to break above the 1.06 level, then it is possible that we could go higher and reach the 1.08 level. The 50 Day EMA sits right there as well, so technical traders will also have that reason to think about shorting. As long as there are plenty of concerns around the world, the US dollar will continue to attract inflows, especially as the interest rate differential between these bond markets continues to favor the downside anyway. I have no interest in buying the Euro, but would have to reevaluate everything if we broke above the 1.08 level, something that is very unlikely anytime soon.
EUR/USD Price Forecast Video 17.05.22
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire