Euro Continues to Trade in the Same Tight Range
Euro vs US Dollar Technical Analysis
The Euro has bounced a bit during the trading session on Wednesday as the 1.05 level continues to be very important. The 1.05 level has previously been very important as far as resistance has been concerned, as there is a lot of noise just below here on historical charts. Because of this, I would anticipate that breaking down below the 1.05 level would be difficult. However, that does not necessarily mean that it cannot happen. We could get a short-term rally from here before selling off again, and that is essentially what I am expecting.
The 1.08 level above continues to offer quite a bit of resistance, and at this point, I think it is essentially going to be thought of as the “ceiling in the market” currently. The 50 Day EMA is racing towards that level as well, so I do think that it is probably only a matter of time before we see things play out in that general vicinity as being a bit too much for the Euro to overcome. In the short term, I think you simply fade rallies just as you do in most pairs that have a quote currency of USD.
If we do break down below the 1.05 level, then it is possible that we go down to the 1.03 level, but it might be more of a grind than a breakdown. The one wildcard of course would be that the Federal Reserve ends up being quite a bit more hawkish than anticipated, perhaps driving money directly into the US dollar at a rapid rate. That being said, the Federal Reserve is obviously aware of a lot of the market fears.
EUR/USD Price Forecast Video 05.05.22
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This article was originally posted on FX Empire