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Last week, our technical indicators suggested going Long at or below 1.1050, setting a Stop Loss at 1.1095, and going Short at or above 1.1051, setting a Stop Loss at 1.1148.
This week, we did not have any trading opportunity on the buy and sell side, having we followed our trading strategy discipline, in the last week technical analysis recommendation.
Fundamental Overview
The EURUSD came under renewed bearish pressure in the late American session on Wednesday and ended the day deep in negative territory. The pair stays on the back foot early Thursday and trades at its lowest level since mid-August below 1.0950.
The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the weakest against the US Dollar.
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
The hawkish tone in the minutes of the Federal Reserve’s (Fed) September policy meeting helped the US Dollar (USD) outperform its rivals late Wednesday, forcing EURUSD to stretch lower. The publication showed that even though a substantial majority of Fed officials supported the 50 basis points (bps) rate cut, there was even a broader consensus that this initial step would not lock the Fed into any specific pace for future rate cuts. Additionally, some participants favored only a 25 bps reduction in the policy rate cut, while “a few others” mentioned they could have supported that decision as well.
The US Bureau of Labor Statistics will release the Consumer Price Index (CPI) data for September later in the day. The annual CPI inflation is forecast to decline to 2.3% from 2.5% in August. The core CPI, which excludes volatile food and energy prices, is seen rising 0.2% on a monthly basis. It will likely require a significant downside surprise, a reading of 0% or lower, in the monthly core CPI data for investors to reconsider the probability of another large Fed rate cut in November. In this scenario, EUR/USD could stage a steady rebound. On the flip side, a print at or above the market forecast could help the USD hold its ground.
For a detailed understanding of market trends, check out our Forex Market Analysis page, where we provide in-depth analysis of various currency pairs.
Technical Analysis
The EURUSD remains vulnerable below 1.0950 ahead of US CPI.
The currency pair consolidates previous losses below 1.0950 in the European session on Thursday. Markets turn cautious and refrain from placing any fresh bets on the pair ahead of the ECB Accounts and the all-important US CPI report.
The Relative Strength Index (RSI) indicator on the 4-hour chart stays near 30, suggesting that the pair is about to turn technically oversold. On the upside, immediate resistance is located at 1.0950 (static level, Fibonacci 61.8% retracement of the latest uptrend). In case EUR/USD stabilizes above this level and confirms it as support, it could edge higher toward 1.1000 (Fibonacci 50% retracement) and 1.1050 (Fibonacci 38.2% retracement).
Looking south, interim support could be spotted at 1.0900 (round level) before 1.0870 (Fibonacci 78.6% retracement) and 1.0800 (round level).
Next week
For next week, the currency pair on the M30 timeframe presents a potential selling opportunity due to a recent downward breakout from a well-defined Bearish Flag pattern. This suggests a shift in momentum towards the downside in the coming Hours.
Hence, our technical analysis is suggesting going Long at or below 1.09323, setting a Stop Loss at 1.0825, and going Short at or above 1.0986, setting a Stop Loss at 1.1050.
As of 10:41 AM (GMT+1), the EURUSD was trading at 1.09321.
EURUSD insights
Pivot points are a technical indicator that traders use to predict upcoming areas of technical significance, such as support and resistance. They are calculated by averaging the high, low and closing prices of a previous period. That could be a day, a week or a month.
If a market is trading above its previous pivot point (known as P), it is seen as a bullish signal. If it is below, it is bearish.
EUR to USD forecast for tomorrow
EUR to USD forecast for tomorrow, Euro to US Dollar forecast on Friday, October, 11: exchange rate 1.090 US Dollars, maximum 1.106, minimum 1.074. EUR to USD forecast on Monday, October, 14: exchange rate 1.091 US Dollars, maximum 1.107, minimum 1.075. Euro to US Dollar forecast on Tuesday, October, 15: exchange rate 1.091 US Dollars, maximum 1.107, minimum 1.075. EUR to USD forecast on Wednesday, October, 16: exchange rate 1.086 US Dollars, maximum 1.102, minimum 1.070.
EUR to USD Forecast for Next Week
In 1 week, Euro to US Dollar forecast on Thursday, October, 17: exchange rate 1.084 US Dollars, maximum 1.100, minimum 1.068. EUR to USD forecast on Friday, October, 18: exchange rate 1.082 US Dollars, maximum 1.098, minimum 1.066. Euro to US Dollar forecast on Monday, October, 21: exchange rate 1.075 US Dollars, maximum 1.091, minimum 1.059. EUR to USD forecast on Tuesday, October, 22: exchange rate 1.072 US Dollars, maximum 1.088, minimum 1.056. Euro to US Dollar forecast on Wednesday, October, 23: exchange rate 1.071 US Dollars, maximum 1.087, minimum 1.055.
To stay updated with our latest forecasts and trading tips, visit our Forex News section regularly. Don’t miss out on our Expert Trading Tips for advanced strategies.
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.
