EUR/USD Forecast – Euro Looks Like It’s Trying to Stabilize

EUR/USD Forecast Video for 18-01-2024

Euro vs US Dollar Technical Analysis

The Euro has initially fell a bit against the US dollar on Wednesday as we continue to see a lot of volatility. The market has tested the 1.09 level, broken down below it, and now it looks like it’s trying to recover. If we can get above the 50-day EMA, it’s likely that the market could go looking to the 1.0950 level. Above there, then we would test the 1.10 level, which has been a major resistance barrier over the last several weeks, and in the past has also been important. However, if we were to fall from here, then the next area we’d be looking at would be the 200-day EMA, which of course is a longer term indicator that a lot of people pay attention to, and then after that the 1.0750 level, which I think is the bottom of the overall consolidation region.

After all, this is a pair that is typically very choppy, and I think we are trying to sort out what we’re going to do for most of the year. The Federal Reserve is expected to cut rates multiple times this year, and I get that, but at the same time you can also make an argument that a lot of traders are starting to focus on the idea that perhaps the ECB is going to have to do the same, especially with Germany heading into a recession and several other European countries looking weak as well.

So, with that being said, I do think this is a rather neutral year for this pair, which doesn’t mean we won’t have a range. But I think really, now we’re just trying to sort out what that range is going to be. Right now, I suspect we’re right around the middle of what the range is for the first couple months of 2024. It’ll be interesting to see how this year plays out, but I expect a lot of choppy behavior more than anything else and therefore I think you have to look at this through the prism of range bound trading for the longer term.

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