Last week, our technical indicators suggested going Long at or below 1.05610, setting a Stop Loss at 1.0490, and going Short at or above 1.06182, setting a Stop Loss at 1.07.

This week, EURUSD price range was 1.0596 high, set this past Tuesday, and 1.0507 low, set this past Monday. So, Monday, we could have bought the currency pair at 1.0508, selling it on an intraday trading at 1.0562, for 0.51% profit. Tuesday, we could have bought it at 1.0533, selling it on an intraday trading at 1.0595, for 0.59% profit. Wednesday, we could have bought it at 1.0524, selling it on an intraday trading at 1.0594, for 0.67% profit. Thursday, we could have bought it at 1.0528, selling it on an intraday trading at 1.0565, for an extra 0.35% ROI.

 Fundamental Overview

EURUSD lost its bullish momentum and closed in negative territory on Wednesday. Surging US Treasury bond yields and the risk-averse market atmosphere allowed the US Dollar (USD) to gather strength and forced the pair to stay on the back foot.

Markets remain relatively quiet early Thursday, allowing EURUSD to consolidate its losses. Meanwhile, US stock index futures trade modestly lower, suggesting that investors remain cautious.

In the second half of the day, Federal Reserve (Fed) Chairman Jerome Powell will deliver a prepared statement and respond to questions before the Economic Club of New York. The Fed’s blackout period will start on Tuesday and Powell could take this opportunity to comment on the policy outlook.

Several Fed policymakers argued earlier in the month that the recent increase in bond yields could allow them to hold the policy rate steady this year. According to the CME Group FedWatch Tool, markets are pricing in a nearly 40% probability that the Fed will raise the policy rate by 25 basis points in December.

In case Powell adopts a dovish tone and says that they could consider holding the policy settings steady given the tighter conditions in the bond market, the USD could come under pressure. On the other hand, the USD is likely to hold its ground if Powell reiterates the data-dependent approach and leave the door open for one more rate increase before the end of the year.

Technical Analysis

EURUSD holds near 1.0550 ahead of Powell speech, as it fluctuates in a narrow channel at around 1.0550 in the European session on Thursday. The risk-averse market environment doesn’t allow the pair to gain traction as markets await US data releases and Fed Chairman Powell’s speech.

EURUSD was last seen fluctuating below 1.0550, where the 100-period Simple Moving Average (SMA) on the 4-hour chart is located. Additionally, the Relative Strength Index (RSI) indicator stays below 50, pointing to a bearish tilt in the near-term outlook.

On the upside, 1.0500 (psychological level, static level) aligns as key support before 1.0450 (end-point of the latest downtrend).

In case the pair rises above 1.0550, 1.0570 (Fibonacci 23.6% retracement of the latest downtrend) could act as immediate resistance before 1.0600.

For next week, EUR/USD is currently at a make or break-level. Notice that EURUSD has struggled at the moving average in the 4-hour chart. If the bulls are unable to take the price above 1.06, then we might see further drops in the EUR.

Hence, our technical analysis are suggesting to go Long at or below 1.05762, setting a Stop loss at 1.0450, and Short it at or above 1.06249, setting a Stop loss at 1.07.

As of 11:48 AM (GMT+1), the EURUSD was trading at 1.06207.

EUR to USD forecast for tomorrow Euro to US Dollar forecast on Friday, October, 20: exchange rate 1.050 US Dollars, maximum 1.066, minimum 1.034. EUR to USD forecast on Monday, October, 23: exchange rate 1.052 US Dollars, maximum 1.068, minimum 1.036. Euro to US Dollar forecast on Tuesday, October, 24: exchange rate 1.057 US Dollars, maximum 1.073, minimum 1.041. EUR to USD forecast on Wednesday, October, 25: exchange rate 1.055 US Dollars, maximum 1.071, minimum 1.039.

In 1 week, Euro to US Dollar forecast on Thursday, October, 26: exchange rate 1.046 US Dollars, maximum 1.062, minimum 1.030. EUR to USD forecast on Friday, October, 27: exchange rate 1.048 US Dollars, maximum 1.064, minimum 1.032. Euro to US Dollar forecast on Monday, October, 30: exchange rate 1.052 US Dollars, maximum 1.068, minimum 1.036. EUR to USD forecast on Tuesday, October, 31: exchange rate 1.050 US Dollars, maximum 1.066, minimum 1.034. Euro to US Dollar forecast on Wednesday, November, 1: exchange rate 1.054 US Dollars, maximum 1.070, minimum 1.038.

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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