EUR/USD Forecast – Euro Continues to See Barrier Above

Euro vs US Dollar Technical Analysis

The euro stalled a bit during the early hours on Wednesday, as it looks like the area above the 1.11 level might be a little bit too much to hang on to. That does make a certain amount of sense when you zoom out on higher timeframes. You can see this is an area that’s been very difficult to overcome. We are overbought according to the relative strength index on both the daily and the four hour charts.

That being said, the FOMC meeting minutes coming out late on Wednesday will have an effect on this pair, I suspect after all, everybody I think is starting to get a little overzealous when it comes to the idea of interest rate cuts coming out of America, and we may see a little bit of balance reenter the market. That being said, if we do close above the 1.115 zero level, it is more likely than not to open up even further buying. Remember, overbought conditions don’t necessarily mean that the market has to pull back.

It just suggests that perhaps a little bit of negativity could go a long way here. If we do pull back, I would suspect somewhere around the 1.10 level we would have a certain amount of psychological support as well as structural support that could come into the picture. If we were to break below there, it is likely that we would see a lot of selling pressure enter the market, and drive the USD higher against most currencies.

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