Last week, our technical indicators suggested going Short at or above 1.10, setting a Stop Loss at 1.11, and going Long below 1.10, setting a Stop Loss at 1.09.

This week, EURUSD price range was 1.1007 high set yesterday, Wednesday, and 1.0918 low, set today. So, Monday, we could have short the currency pair at 1.1054, covering it on an intraday trading at 1.10, for 0.49% profit.  Tuesday, we could have short it at 1.1005, covering it on an intraday trading at 1.0942, for 0.58% profit. Also, Tuesday, we could have bought it at 1.0942, selling it on an intraday trading at 1.1005, for 0.58% profit.  Wednesday, we could have short it at 1.1006, covering it on an intraday trading at 1.0942, for 0.58% profit. Also, Wednesday, we could have bought it at 1.0942, selling it on an intraday trading at 1.1006, for 0.58% profit. Thursday, we could have bought it at 1.0919, selling it on an intraday trading at 1.0997, for an extra 0.71% ROI.

Fundamental Overview

EURUSD came under renewed bearish pressure and dropped toward 1.0900 in the European morning on Thursday, touching its lowest level since mid-April in the process. The pair seems to have turned technically bearish and sellers are likely to stay in control as long as 1.0950 resistance stays intact. The US Dollar struggled to find demand in the second half of the day on Wednesday after the data from the US showed that the annual Consumer Price Index (CPI) rose 4.9% in April, compared to the market expectation of 5%. Nevertheless, the mixed trading action in Wall Street didn’t allow risk mood to improve and EUR/USD failed to reclaim 1.1000.

Citing sources familiar with the matter, Bloomberg reported early Thursday that some European Central Bank (ECB) policymakers have been speculating that they might need to hike rates for three more times to tame inflation. Hawkish ECB policymaker and Bundesbank Chief Joachim Nagel, however, refrained from confirming the possibility of a rate increase in September and reiterated that the “meeting-by-meeting approach” was the right path for the ECB. The Euro lost its traction following these comments. Later in the day, ECB policymaker Isabel Schnabel and Vice President Luis de Guindos will be delivering speeches.

In the early American session, the Producer Price Index data for April and the weekly Initial Jobless Claims will be featured in the US economic docket. Markets are nearly fully pricing a pause in the Federal Reserve’s tightening cycle in June and these data are unlikely to influence the Fed’s rate outlook in a significant way. Hence, ECB commentary could impact the Euro’s valuation and drive EURUSD’s movements.

Technical Analysis

EURUSD recovers modestly from multi-week lows, trades near 1.0950.

EURUSD has managed to erase a small portion of its daily losses after having declined to its weakest level in nearly three weeks below 1.0920 on Thursday. Following the mixed macroeconomic data releases from the US, the USD clings to daily recovery gains, limiting the pair’s upside.

EURUSD broke below 1.0950, where the Fibonacci 23.6% retracement of the latest uptrend and the 200-period Simple Moving Average (SMA) align. Meanwhile, the Relative Strength Index (RSI) indicator dropped below 50, pointing to a buildup of bearish momentum.

On the downside, 1.0900 (psychological level) aligns as interim support ahead of 1.0870 (Fibonacci 38.2% retracement) and 1.0840 (static level).

In case EURUSD manages to reclaim 1.0950, it is likely to face stiff resistance at 1.1000 (50-period SMA, 20-period SMA, psychological level) before targeting 1.1050 (static level).

 For next week, our technical analysis are suggesting going Short at or above 1.08, setting a Stop Loss at 1.10, and going Long below 1.085, setting a Stop Loss at 1.08.

As of 14:28 PM (GMT+1), the EURUSD was trading at 1.09188.

 

EUR to USD forecast for tomorrow: Euro to US Dollar forecast on Friday, May, 12: exchange rate 1.101 US Dollars, maximum 1.118, minimum 1.084. EUR to USD forecast on Monday, May, 15: exchange rate 1.097 US Dollars, maximum 1.113, minimum 1.081. Euro to US Dollar forecast on Tuesday, May, 16: exchange rate 1.095 US Dollars, maximum 1.111, minimum 1.079. EUR to USD forecast on Wednesday, May, 17: exchange rate 1.096 US Dollars, maximum 1.112, minimum 1.080.

In 1 week, Euro to US Dollar forecast on Thursday, May, 18: exchange rate 1.090 US Dollars, maximum 1.106, minimum 1.074. EUR to USD forecast on Friday, May, 19: exchange rate 1.097 US Dollars, maximum 1.113, minimum 1.081. Euro to US Dollar forecast on Monday, May, 22: exchange rate 1.100 US Dollars, maximum 1.117, minimum 1.084. EUR to USD forecast on Tuesday, May, 23: exchange rate 1.096 US Dollars, maximum 1.112, minimum 1.080. Euro to US Dollar forecast on Wednesday, May, 24: exchange rate 1.094 US Dollars, maximum 1.110, minimum 1.078.

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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