EURUSD Rates Week in Review

Last week, our technical indicators suggested to go Long at or below 1.1350, setting a Stop Loss at 1.12, and to Short the currency pair at or above 1.1355, setting a Stop Loss at 1.15.

This week, EURUSD price range was 1.1343 high, set yesterday, Wednesday, and 1.1234 low, set this past Monday. Another great week for Longs in the EURUSD, as on Monday, we could have bought the EURUSD at 1.1236, selling it on an intraday trading at 1.1303, for 0.6% profit. Tuesday, we could have bought it at 1.1262, selling it on an intraday trading at 1.1301, for 0.35% profit. Wednesday, we could have bought it at 1.1266, selling it on an intraday trading at 1.1341, for 0.67% profit.  Today, Thursday, we could have bought it at 1.1303, selling it on an intraday trading at 1.1340, for an extra 0.33% ROI.

 Fundamental Overview

EURUSD has gathered bullish momentum late Wednesday and advanced to its highest level in nearly a week above 1.1340 as the risk-positive market environment made it difficult for the greenback to find demand. The near-term technical outlook points to a bullish shift but the 1.1320 support needs to hold to keep buyers interested.

Reports suggesting that the coronavirus Omicron variant is causing fewer hospitalizations than the Delta variant allowed the market mood to remain upbeat on Wednesday. With major equity indexes in the US posting decisive gains, the US Dollar Index (DXY), which tracks the dollar’s performance against a basket of six major currencies, dropped toward the lower limit of its three-week-old trading range at 96.00.

Later in the session, the Personal Consumption Expenditures (PCE) Price Index data will be featured in the US economic docket. Investors expect the Core PCE inflation to rise to 4.5% on a yearly basis in November from 4.1% in October. A stronger-than-expected print could revive inflation fears and cause the risk rally to lose steam. On the flip side, a soft inflation reading is likely to limit a potential recovery in the DXY.

November New Home Sales and Durable Goods orders data from the US will also be looked upon for fresh impetus alongside the weekly Initial Jobless Claims report. Ahead of the Christmas holiday, however, the risk perception is likely to remain the primary driver of the greenback’s market valuation.

Technical Analysis

EURUSD is trading above the 200-period SMA on the following four-hour chart, for the first time since late October.


Additionally, the Relative Strength Index (RSI) indicator on the same chart is staying below 70, suggesting that the pair has more room on the upside before it becomes technically oversold.

1.1360 (post-ECB high) aligns as the first technical resistance before 1.1380 (Nov. 30 high) and 1.1400 (psychological level).

On the downside, additional corrective losses toward 1.1300 (psychological level, 100-period SMA) and 1.1280 (50-period SMA) could be witnessed if a four-hour candle closes below 1.1320 (200-period SMA).

For next week, the beginning of the bullish wave was set on December 19, before three days the price almost reached our previously EURUSD technical target of 1.1358. Indeed, a bullish flag pattern has already been created. According to our technical analysis and taking into consideration the place where the first target was (above the flag), our technical indicators indicate EURUSD can move higher up to the second target 1.4400. Hence, for next week, our technical indicators are suggesting to go Long on the currency pair at or below 1.1440, setting a stop loss 1.1280, and to go Short at or above 1.1440, setting a stop loss at 1.15.


As of 2:32 PM (GMT), the EURUSD was trading at 1.12982.


EUR to USD forecast for tomorrow: Euro to Dollar forecast on Friday, December, 24: exchange rate 1.1375 Dollars, maximum 1.1546, minimum 1.1204. EUR to USD forecast on Monday, December, 27: exchange rate 1.1377 Dollars, maximum 1.1548, minimum 1.1206. Euro to Dollar forecast on Tuesday, December, 28: exchange rate 1.1413 Dollars, maximum 1.1584, minimum 1.1242. EUR to USD forecast on Wednesday, December, 29: exchange rate 1.1326 Dollars, maximum 1.1496, minimum 1.1156.


In 1 week, Euro to Dollar forecast on Thursday, December, 30: exchange rate 1.1362 Dollars, maximum 1.1532, minimum 1.1192. EUR to USD forecast on Friday, December, 31: exchange rate 1.1395 Dollars, maximum 1.1566, minimum 1.1224. Euro to Dollar forecast on Monday, January, 3: exchange rate 1.1372 Dollars, maximum 1.1543, minimum 1.1201. EUR to USD forecast on Tuesday, January, 4: exchange rate 1.1334 Dollars, maximum 1.1504, minimum 1.1164. Euro to Dollar forecast on Wednesday, January, 5: exchange rate 1.1361 Dollars, maximum 1.1531, minimum 1.1191.

Until the next article, wishing you all Merry Christmas!





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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