EUR/USD Forecast Video for 31.10.23
Euro vs US Dollar Technical Analysis
The euro fell after initially trying to rally. At this point, the market looks as if it is going to try to get down to the 1.05 level below. The 1.05 level underneath of course is a large, round, psychologically significant figure, and therefore, I think you’ve got a situation where the market is likely to continue to see a lot of noisy behavior. With this, I think the overall attitude of this market is negative, but there is the possibility that it holds up a little bit. If we were to break down below the 1.05 level, it would open up a move to much lower pricing, perhaps down to the 1.0250 level.
The 1.0250 level is an area that people have seen a bit of support at previously, and therefore I think it’s probably a situation where you have a bounce from there. The 1.0250 level is an area that although supportive, is not a major support level, and therefore it’s likely that we would even drop all the way down to the parity level.
Turning things around at this point opens up the possibility of an attempt to reach the 50-Day EMA above, which is at the most recent high. The 1.0650 level is roughly where that’s at, and it’s very unlikely that we will continue to see enough upward pressure to make that happen, but it is something that you need to keep in the back of your mind just in case we get a complete turnaround.
The market is in the midst of breaking through the bottom of a bearish flag, and that of course is something that people are paying attention to. Ultimately, the US dollar continues to be thought of as a safety currency, and in this environment, that of course is something that is very important to pay attention to. The higher interest rates in the United States and the rising interest rate environment that we find ourselves in continues to favor the greenback. Ultimately, I just don’t see an area where we recover for a longer-term move anytime soon, at least not until the ECB changes its overall outlook, or perhaps more importantly, the Federal Reserve does.
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This article was originally posted on FX Empire
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