Last week, our technical indicators suggested 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.

This week, EURUSD price range was 1.0905 high set this past Tuesday, and 1.0762 low, set today. So, Monday, we could have short the currency pair at 1.0890, covering it on an intraday trading at 1.0846, for 0.4% profit.  Tuesday, we could have short it at 1.0904, covering it on an intraday trading at 1.0856, for 0.44% profit. Wednesday, we could have short it at 1.0877, covering it on an intraday trading at 1.0811, for 0.61% profit.  Also, Wednesday, we could have bought it at 1.0811, selling it on an intraday trading at 1.0877, for 0.61% profit.

Thursday, we could have short it at 1.0848, covering it on an intraday trading at 1.0763, for 0.78% profit. Also, Thursday, we could have bought it at 1.08, selling it on an intraday trading at 1.0848, for an extra 0.44% ROI.

Fundamental Overview

The EURUSD pair remains under selling pressure, trading below the 1.0800 threshold. The Greenback retains its latest strength despite resurgent optimism, as United States (US) authorities are on their way to clinching a deal on extending the debt ceiling. Furthermore, easing concerns about the banking crisis underpin the mood. Bank stocks are up as US Western Alliance reported a rise in deposits, suggesting depositors’ flight receded. Global stock markets maintain the green on Thursday, reflecting the better sentiment, but things are different across the FX board as the US Dollar advances against most major rivals.

The European macroeconomic calendar had nothing relevant to offer, although European Central Bank (ECB) Vice President Luis de Guindos hit the wires, noting that “inflation in services is the most worrying for the ECB,” adding there is still scope to keep raising rates.

On the other hand, the US published Initial Jobless Claims for the week ended May 12, which increased by 242 K, beating the 254K expected and decreasing from 264K in the previous week. Also, the May Philadelphia Fed Manufacturing Survey printed at -10.4, improving from -31.3 in April and better than the -19.8 anticipated by financial markets. The US Dollar ticked higher with the news. Later in the American session, the country will publish April Existing Home Sales.

Technical Analysis

EURUSD hits fresh monthly lows under 1.0770, DXY breaks above 103.50.

During the American session, the EURUSD continued to drop and hit a new seven-week low at 1.0762. The pair remains under pressure due to a stronger US Dollar across the board, which is being supported by hawkish comments from Fed officials and positive US economic data.

The EURUSD pair pierced the 1.0800 threshold, and technical readings in the daily chart support a bearish extension the upcoming sessions. The pair extends its decline below a firmly bearish 20 Simple Moving Average (SMA) while it is currently piercing a mildly bullish 100 SMA.  At the same time, the Momentum indicator heads south at fresh two-month lows, while the Relative Strength Index (RSI) indicator hovers around 37, in line with another leg south.

The bearish case is also clear in the near term, as the above 4-hour chart shows that technical indicators head south almost vertically without signs of downward exhaustion. In fact, the RSI is currently at 27, suggesting market participants are ready to test the 1.0745 support level, the 61.8% retracement of the 2022 yearly decline. Finally, the pair develops below all its moving averages, with the 20 SMA well below the longer ones and the 100 SMA aiming to cross below the 200 SMA.

Support levels are at 1.0745, 1.0700, and 1.0660.

Resistance levels are at 1.0815, 1.0850, and 1.0895.

 For next week, the currency pair price perfectly fulfilled our last idea, hitting targeted support level. Further, the market formed divergence at support level after breaking the level. We expect the price to break the strong support level at 1.0768, before bouncing back to the previous strong resistance zone of 1.09-1.08.

Our technical analysis are suggesting going Short at or above 1.08, setting a Stop Loss at 1.095, and going Long below 1.08262, setting a Stop Loss at 1.06.

As of 20:09 PM (GMT+1), the EURUSD was trading at 1.07680.

EUR to USD forecast for tomorrow: Euro to US Dollar forecast on Friday, May, 19: exchange rate 1.082 US Dollars, maximum 1.098, minimum 1.066. EUR to USD forecast on Monday, May, 22: exchange rate 1.081 US Dollars, maximum 1.097, minimum 1.065. Euro to US Dollar forecast on Tuesday, May, 23: exchange rate 1.084 US Dollars, maximum 1.100, minimum 1.068. EUR to USD forecast on Wednesday, May, 24: exchange rate 1.077 US Dollars, maximum 1.093, minimum 1.061.


In 1 week, Euro to US Dollar forecast on Thursday, May, 25: exchange rate 1.070 US Dollars, maximum 1.086, minimum 1.054. EUR to USD forecast on Friday, May, 26: exchange rate 1.072 US Dollars, maximum 1.088, minimum 1.056. Euro to US Dollar forecast on Monday, May, 29: exchange rate 1.068 US Dollars, maximum 1.084, minimum 1.052. EUR to USD forecast on Tuesday, May, 30: exchange rate 1.066 US Dollars, maximum 1.082, minimum 1.050. Euro to US Dollar forecast on Wednesday, May, 31: exchange rate 1.067 US Dollars, maximum 1.083, minimum 1.051.


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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