EUR/USD Weekly Forecast – Euro Plunges for the Week

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EUR/USD Forecast Video for 15.05.23

Euro vs US Dollar Weekly Technical Analysis

The euro initially tried to rally during the trading week but then fell apart. At this point, the euro has turned around quite drastically, breaking down below the 1.09 level. The 1.09 level is an area that had been supported previously, and the fact that we are plunging so quickly, it’s likely that we could go down to the 1.07 level, maybe even a little bit lower, to reach the 50-Week EMA. The 200-Week EMA has offered significant resistance, so it’ll be interesting to see whether or not the market will look at that as a ceiling.

In general, this is a market that is squeezing between the 2 major moving averages, and that typically causes a lot of volatility. Furthermore, you need to keep in mind that the European Union is probably going to be facing some major issues, and with concerns about the global economy and banking sector, it does make a certain amount of sense that the US dollar could attract inflows. Furthermore, the tight monetary policy coming out of the Federal Reserve also makes the US dollar potentially attractive.

It might be worth noting that on Friday, both the US dollar and gold were showing signs of strength, so it does suggest that there is a certain amount of fear in the market, and that could offer quite a bit of demand for the greenback and perhaps traders trying to run away from riskier currencies, although admittedly the euro is not necessarily like a commodity currency or an emerging market currency, it is considered 2nd to the US dollar when it comes to protecting wealth. At this point, it’s likely that we continue to see volatility and choppiness going forward.

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

This article was originally posted on FX Empire