Last week, our technical indicators suggested going Short at or above 1.0941, setting a Stop Loss at 1.1045, and going Long at or below 1.0940, setting a Stop Loss at 1.08.

This week, EURUSD price range was 1.1027 high set today, Thursday, and 1.0928 low set this past Tuesday. So, Monday, we could have short the currency pair at 1.1020, covering it on an intraday trading at 1.0966, for 0.49% profit. Tuesday, we could have short it at 1.1013, covering it on an intraday trading at 1.0929, for 0.76% profit. Wednesday, we could have short it at 1.0997, covering it on an intraday trading at 1.0952, for 0.82% profit. Thursday, we could have short it at 1.1028, covering it on an intraday trading at 1.0969, for an extra 0.54% ROI.

 Fundamental Overview

EURUSD gathered bullish momentum and climbed above 1.1000 early Thursday after posting small daily gains on Wednesday. July inflation data from the US could trigger a big reaction in the pair in the early American session.

The modest US Dollar (USD) weakness hell EURUSD to hold its ground mid-week. The negative shift witnessed in risk sentiment, however, limited USD’s losses in the American session and made it difficult for the pair to continue to stretch higher.

Early Thursday, the Euro Stoxx Index is up nearly 1% and US stock index futures gain between 0.5% and 0.6%, reflecting an upbeat market mood that doesn’t allow the safe-haven USD to find demand.

The annual Consumer Price Index (CPI) in the US is forecast to rise 3.3% in July, compared to the 3% increase recorded in June. On a monthly basis, the CPI and the Core CPI, which excludes volatile food and energy prices, are both forecast to edge up 0.2%.

A small 0.1% increase or a no change in monthly Core CPI could put additional weight on the USD’s shoulders and fuel another leg higher in EUR/USD with the initial reaction. On the other hand, a reading at or above 0.4% could bring back hawkish Federal Reserve bets and provide a boost to the USD, forcing the pair to turn south as a result. According to the CME Group FedWatch Tool, markets are pricing in a 26% probability of the Fed interest rate sitting at 5.5-5.75% range by the end of the year.

Meanwhile, the European Central Bank (ECB) noted in its monthly Economic Bulletin that the outlook for the Eurozone economic growth and inflation remains highly uncertain.

Technical Analysis

EURUSD was last seen trading near 1.1020, where the 200-period Simple Moving Average (SMA) on the 4-hour chart is located. On the same chart, the Relative Strength Index (RSI) indicator stays slightly above 60, suggesting that the pair has more room on the upside before turning technically overbought.

In case EURUSD stabilizes above 1.1020, 1.1050 (Fibonacci 38.2% retracement of the latest downtrend) aligns as next resistance before 1.1090/1.1100 (Fibonacci 50% retracement, static level) and 1.1130 (Fibonacci 61.8% retracement).

On the downside, 1.1000 (Fibonacci 23.6% retracement) forms important support before 1.0980 (20-period SMA, 50-period SMA) and 1.0950 (static level).

For next week, EURUSD has been trading in a down bullish trend. However, the price formed a wedge pattern on the weekly with a sharp drop, the price is now at support level which might offer a price bounce.

Our technical analysis are suggesting going Short on the second leg down at or above 1.10, setting a Stop Loss at 1.1150, and going Long at or below 1.09771, setting a Stop Loss at 1.08337.

As of 11:01 AM (GMT+1), the EURUSD was trading at 1.1020.

 

EUR to USD forecast for tomorrow: Euro to US Dollar forecast on Friday, August, 11: exchange rate 1.100 US Dollars, maximum 1.117, minimum 1.084. EUR to USD forecast on Monday, August, 14: exchange rate 1.095 US Dollars, maximum 1.111, minimum 1.079. Euro to US Dollar forecast on Tuesday, August, 15: exchange rate 1.094 US Dollars, maximum 1.110, minimum 1.078. EUR to USD forecast on Wednesday, August, 16: exchange rate 1.100 US Dollars, maximum 1.117, minimum 1.084.

In 1 week, Euro to US Dollar forecast on Thursday, August, 17: exchange rate 1.101 US Dollars, maximum 1.118, minimum 1.084. EUR to USD forecast on Friday, August, 18: exchange rate 1.094 US Dollars, maximum 1.110, minimum 1.078. Euro to US Dollar forecast on Monday, August, 21: exchange rate 1.096 US Dollars, maximum 1.112, minimum 1.080. EUR to USD forecast on Tuesday, August, 22: exchange rate 1.094 US Dollars, maximum 1.110, minimum 1.078. Euro to US Dollar forecast on Wednesday, August, 23: exchange rate 1.098 US Dollars, maximum 1.114, minimum 1.082.

Until next article, wishing all of you wealthy trading!

 

 

Disclosures: The material provided herein is for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy any interests in the EUR/USD or any other securities. This overview may include or be based in part on projections, valuations, estimates and other financial data supplied by third parties, which has not been verified by Pedro Ferreira. Any information regarding projected or estimated investment returns are estimates only and should not be considered indicative of the actual results that may be realized or predictive of the performance of the EUR/USD or any underlying security.  Further, Pedro Ferreira is not long or short in the currency pair. Past investment results of any underlying managers should not be viewed as indicative of future performance of the EUR/USD.

 

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