Last week, our technical indicators suggested going Short at or above 1.10361, setting a Stop Loss at 1.12, and going Long at or below 1.09349, setting a Stop Loss at 1.08687.

This week, EURUSD price range was 1.1277 high set this past Tuesday, and 1.1174 low, set yesterday, Wednesday. Again, having we kept our trading discipline, this week and so far, we just had one trading opportunity on Wednesday to short the currency pair at 1.12, covering it on an intraday trading at 1.1175, for 0.22% ROI.

Fundamental Overview

Following Wednesday’s slide, EURUSD stabilized slightly above 1.1200 in the European session on Thursday. The pair’s technical outlook does not yet point to a buildup of bearish momentum but a daily close below 1.1200 could attract sellers.

The renewed US Dollar (USD) strength caused EUR/USD to stay under bearish pressure midweek. Meanwhile, European Central (ECB) Bank Governing Council member Yannis Stournaras argued that the ECB could stop hiking rates after 25 bps increase in July, putting additional weight on the Euro’s shoulders.

Early Thursday, US stock index futures trade in negative territory as investors stay away from risk-sensitive assets following uninspiring earnings figures from big US tech firms. In case markets remain risk-averse in the second half of the day, the USD could continue to find demand and make it difficult for EURUSD to gain traction.

The US economic docket will feature the weekly Initial Jobless Claims data, which is forecast to rise to 242,000 from 237,000 last week. A sharp increase in the number of first-time applications for unemployment benefits could cause the USD to weaken against its rivals.

Technical Analysis

EURUSD is paring back gains but holds above 1.1200 in the early European session. The pair has turned south again due to a modest uptick in the US Dollar in tandem with the US Treasury bond yields. Investors stay cautious ahead of mid-tier EU and US data.

 EURUSD continues to trade below the lower limit of the ascending regression channel and the 20-period Simple Moving Average (SMA) on the 4-hour chart. The Relative Strength Index (RSI) indicator, however, moves sideways near 50, suggesting that the pair is yet to gather bearish momentum.

In case EURUSD closes the day below 1.1200 (psychological level, static level) and confirms that level as resistance, additional losses toward 1.1160 (Fibonacci 23.6% retracement level of the latest uptrend, 50-period SMA) and 1.1100 (Fibonacci 38.2% retracement) could be seen.

On the upside, 1.1230 (20-period SMA) aligns as interim resistance before 1.1270 (static level from March 2022, multi-month high set on Tuesday, lower limit of the ascending channel) and 1.1300 (psychological level).

For next week, EURUSD has broken an important resistance, hence we expect it to grow to at least the specified level after the pullback to the broken resistance.

Our technical analysis are suggesting going Short at or above 1.1250, setting a Stop Loss at 1.15, and going Long below 1.1203, setting a Stop Loss at 1.10.

As of 11:10 AM (GMT+1), the EURUSD was trading at 1.12063.

EUR to USD forecast for tomorrow: Euro to US Dollar forecast on Friday, July, 21: exchange rate 1.117 US Dollars, maximum 1.134, minimum 1.100. EUR to USD forecast on Monday, July, 24: exchange rate 1.116 US Dollars, maximum 1.133, minimum 1.099. Euro to US Dollar forecast on Tuesday, July, 25: exchange rate 1.117 US Dollars, maximum 1.134, minimum 1.100. EUR to USD forecast on Wednesday, July, 26: exchange rate 1.117 US Dollars, maximum 1.134, minimum 1.100.

In 1 week, Euro to US Dollar forecast on Thursday, July, 27: exchange rate 1.126 US Dollars, maximum 1.143, minimum 1.109. EUR to USD forecast on Friday, July, 28: exchange rate 1.139 US Dollars, maximum 1.156, minimum 1.122. Euro to US Dollar forecast on Monday, July, 31: exchange rate 1.140 US Dollars, maximum 1.157, minimum 1.123. EUR to USD forecast on Tuesday, August, 1: exchange rate 1.143 US Dollars, maximum 1.160, minimum 1.126. Euro to US Dollar forecast on Wednesday, August, 2: exchange rate 1.151 US Dollars, maximum 1.168, minimum 1.134.

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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