EUR/USD Forecast – Euro Continues to Chop Back and Forth

Euro vs US Dollar Technical Analysis

The Euro was somewhat sideways in the early hours on Wednesday as we continue to see a lot of drifting back and forth. This is probably not a huge surprise considering that most traders are trying to sort out whether or not the interest rate cuts coming out of Brussels are over and of course whether or not the Federal Reserve is going to be as aggressive as people once thought.

After all, the market has priced in so many interest rate cuts that you have to ask the question whether or not they see something rather ugly coming. And if they do, if there is some type of serious recession, there’s a real shot that the Federal Reserve cutting that aggressively could actually be strong US dollar happening because we have the fear out there that would drive money into the Treasury market.

So, while it is a little on counterintuitive for newer traders, the reality is, uh, the fear could drive money right back into the U S even if the fear is about the U S recently, we’ve seen this market just kind of go back and forth between one major figure and another. For example, the 1.10 level underneath is support, and the 1.11 level above is resistance, and I do think we continue that pattern, but right now we’re just somewhat stuck between the two major round numbers.

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