EUR/USD Forecast – Euro Signs Buyers After Short-term Dip

EUR/USD Forecast Video for 26.12.23

Euro vs US Dollar Technical Analysis

The euro initially pulled back just a bit during the trading session on Friday, only to turn around and show signs of life again. All things being equal, this is a situation where we should see plenty of buyers trying to take advantage of “cheap euros,” and therefore it’s likely that we will eventually try to break out for a bigger move. All things being equal, this is a situation where if we do break above the highs of the day, then it is likely that the euro goes looking to the 1.1250 level. In general, as we had through the holidays though, it’s going to be difficult to see a major move in the next few days.

The 1.1250 level is an area that previously had been significant resistance, and an area that does make a certain amount of sense as a target because of this. That being said, I think that given enough time, the traders out there will continue to push this pair higher due to the fact that the United States looks to be ready to cut rates next year. That works against the currency, and the Euro will be a major beneficiary of that momentum. However, if the market were to break down below here, then the 1.0950 level offers a significant amount of support, and then again, we see even more at the 1.0850 level.

All things being equal, I do think that this market remains a “buy on the dips” scenario, and the fact that we have broken above the recent high suggests that the market is ready to come into its own when it comes to the uptrend, and now we have broken out to the point where we are ready to go higher. Short-term pullbacks again will offer value that a lot of people are paying attention to, but all things being equal, this is a pair that will continue to try to test that major high above, but if we were to break above that level, then tests that major swing high at the 1.1250 level, but I don’t know if we break above there because I think that given enough time, it’s likely that we will have to pay close attention to why rates are being cut in the United States, because if we start to see a major recession globally, that could have traders coming back to the dollar at that point. In the short term though, I think that the 1.1250 level above is our most likely destination over the next couple of weeks or months.

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