Last week, our technical indicators suggested going Long at or below 1.08470 setting a Stop Loss at 1.07877, and going Short at or above 1.08471, setting a Stop Loss at 1.109.

This week, the EURUSD price range was 1.0890 high, set this past Tuesday, and 1.0788 low, set today, Thursday. So, on Monday, we could have bought the currency pair at 1.0842, selling it on an intraday trading at 1.0867, for 0.23% profit. Also , on Monday, we could have short it at 1.0867, covering it on an intraday trading at 1.0842, for 0.23% profit. Tuesday, we could have short it at 1.0889, covering it on an intraday trading at 1.0854, for 0.32% profit. Wednesday, we could have short it at 1.0860, covering it on an intraday trading at 1.08, for 0.56% profit. Thursday, we could have bought it at 1.0789, selling it on an intraday trading at 1.0833, for an extra 0.41% ROI.

Fundamental Overview

The US Dollar maintained its sentiment-inspired momentum throughout the first half of the day, resulting in EURUSD falling to 1.0787, its lowest in two weeks. As the market mood improved, the pair recovered above the 1.0800 threshold, but remains depressed at around 1.0820. Financial markets turned risk-averse following a batch of Federal Reserve (Fed) officials cooling down hopes for a soon-to-come rate cut and poor government bond auctions. Treasury yields surged to fresh multi-week highs on Wednesday, further supporting the USD.

Meanwhile, European indexes trade with modest gains, but that’s not enough for Wall Street. United States (US) indexes hover around their Wednesday closing levels ahead of the opening and seem poised to extend their slides.

Data-wise,  the Eurozone released the May Economic Sentiment Indicator, which improved by less than anticipated to 96 from 95.6 in April. Across the pond, the US released a revision of the Q1 Gross Domestic Product (GDP), which was downwardly revised to 1.3% from 1.6% as expected. At the same time, Initial Jobless Claims for the week ended May 24 increased to 219K, worse than the 218K expected. Finally, the preliminary estimate of April Wholesale Inventories increased by 0.2%, worse than the 0.1% decline anticipated. April Pending Home Sales and a couple of Fed officials will stand out in the American afternoon.

Technical Analysis

The following daily chart for the EURUSD pair shows it trades in the green, although at the lower end of its Wednesday range. It met buyers around a flat 200 Simple Moving Average (SMA) and is currently battling with converging 20 and 100 SMAs. The shorter one aims higher, suggesting increased buying interest. Technical indicators, in the meantime, picked up modestly after testing their midlines, not enough to confirm another leg higher but a sign of limited selling pressure.

Chances of a firmer recovery seem limited in the near term. The following 4-hour chart shows the pair cannot overcome a flat 100 SMA, while the 20 SMA maintains its bearish slope above the longer one. Finally, technical indicators corrected from near oversold levels but lose upward momentum within negative levels.

Support levels are at 1.0815, 1.0780, and 1.0740.

Resistance levels are at 1.0910, 1.0960, and 1.1000.

For next week, the technical outlook of EMA 34.89 after the previous reversal is positive. It is expected that if the upward momentum continues, potential support levels are held by the bulls at 1.0845 and 1.0810 for accumulation before targeting growth at local highs including 1.09450 and 1, 0979 as a target at least as the overall outlook after this breakout is very strong for medium to long-term buyers.

Hence, our technical analysis is suggesting going Long at or below 1.08470 setting a Stop Loss at 1.07877, and going Short at or above 1.08471, setting a Stop Loss at 1.109.

As of 16:00 AM (GMT+1), the EURUSD was trading at 1.08404.

EUR to USD forecast for tomorrow Euro to US Dollar forecast on Thursday, May, 30: exchange rate 1.075 US Dollars, maximum 1.091, minimum 1.059. EUR to USD forecast on Friday, May, 31: exchange rate 1.075 US Dollars, maximum 1.091, minimum 1.059. Euro to US Dollar forecast on Monday, June, 3: exchange rate 1.076 US Dollars, maximum 1.092, minimum 1.060. EUR to USD forecast on Tuesday, June, 4: exchange rate 1.079 US Dollars, maximum 1.095, minimum 1.063.

In 1 week, Euro to US Dollar forecast on Wednesday, June, 5: exchange rate 1.078 US Dollars, maximum 1.094, minimum 1.062. EUR to USD forecast on Thursday, June, 6: exchange rate 1.075 US Dollars, maximum 1.091, minimum 1.059. Euro to US Dollar forecast on Friday, June, 7: exchange rate 1.075 US Dollars, maximum 1.091, minimum 1.059. EUR to USD forecast on Monday, June, 10: exchange rate 1.074 US Dollars, maximum 1.090, minimum 1.058. Euro to US Dollar forecast on Tuesday, June, 11: exchange rate 1.074 US Dollars, maximum 1.090, minimum 1.058.

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.