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EUR/USD Forecast – Euro Bounces a Bit on Thursday

By:
Christopher Lewis
Published: Jan 4, 2024, 13:25 GMT+00:00

The euro bounced a bit during the day on Thursday as it looks like traders are finally coming back in to pick up on the dip that has occurred over the last several sessions.

Euro bills, FX Empire
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EUR/USD Forecast Video for 05-01-2024

Euro vs US Dollar Technical Analysis

The Euro has risen a bit during the session on Thursday as we have broken above the 1.0950 level early during the day and it also looks like we are trying to stabilize after what has been a rough couple of sessions. Ultimately, this is a market that will be paying close attention to the 1.10 level above as it is a large round number, and of course a lot of psychology is attached to it. If we can clear that figure, then I think that the euro can continue to go higher. And with Friday seeing the non-farm payroll announcement coming down in the United States, it does make a certain amount of sense that Friday could be the day it happens. It also makes sense that Thursday has seen a little bit of a pullback, but ultimately this is a scenario where we are just kind of spinning our wheels.

If we were to break down below the bottom of the candlestick for the Tuesday session, then we start to look at the 50-day EMA underneath, which of course is an indicator that a lot of people will pay attention to for support. In general, this is a market that I think continues to be noisy, but we are still very much in an uptrend, despite the fact that we have had a couple of rough days that have seen the US dollar pick up momentum.

Pay attention to the bond market in the United States. That will be the main feature of what drives this pair. If the US dollar starts to rally due to the bond market, you will see higher rates in those bonds, thereby making it more attractive to own them. On the other hand, if those rates start to drop, it tends to make the euro much more attractive. This of course assumes that rates aren’t dropping because of some type of panic. Hopefully that doesn’t happen, but with this type of environment, anything is going to be possible as there is conflict breaking out everywhere it seems.

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

About the Author

Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.

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