EUR/USD Forecast: 1.0130 aligns as next target unless euro steadies above 1.0200
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFER- EUR/USD has gone into a consolidation phase near 1.0200.
- Additional losses toward 1.0130 could be witnessed in the near term.
- Markets continue to scale down ECB rate hike bets.
EUR/USD has gone into a consolidation phase after having plunged to its weakest level since December 2002 at 1.0161 on Wednesday. Unless the pair manages to rise above 1.0200 and start using that level as support, additional losses could be witnessed in the near term.
Relentless dollar buying amid recession fears continued on Wednesday and the US Dollar Index reached its strongest level in nearly two decades above 107.00. The minutes of the Federal Reserve's June policy meeting showed late Wednesday that policymakers reiterated high inflation warranted 'restrictive' interest rates, with the possibility of a 'more restrictive stance' if inflation persists.
With risk flows returning to markets in the European trading hours, the greenback is having a difficult time gathering further strength and allowing EUR/USD to stay relatively calm.
Later in the session, the European Central Bank will release the Monetary Policy Meeting Accounts for June. According to Reuters, the market positioning shows that the ECB is now expected to hike its policy rate by a total of 135 basis points by the end of the year, compared to 190 bps in mid-June. Investors are reassessing the ECB's rate outlook as the energy crisis is expected to cause the economy to tip into recession.
In the second half of the day, the US economic docket will feature the weekly Initial Jobless Claims and May Goods Trade Balance data. In case Wall Street's main indexes stage a decisive rebound, EUR/USD losses could remain limited. The pair, however, is unlikely to break out of its downtrend in the current market environment.
EUR/USD Technical Analysis
EUR/USD remains technically oversold in the short term with the Relative Strength Index (RSI) indicator staying below 30. 1.0200 (psychological level, static level) aligns as initial resistance and in case the pair manages to flip that level into support, it could extend its recovery toward 1.0250 (upper limit of the descending regression channel, static level).
On the downside, 1.0160 (multi-decade low set on Wednesday) forms interim support ahead of 1.0130 (static level from November 2002, former resistance) and 1.0100.
- EUR/USD has gone into a consolidation phase near 1.0200.
- Additional losses toward 1.0130 could be witnessed in the near term.
- Markets continue to scale down ECB rate hike bets.
EUR/USD has gone into a consolidation phase after having plunged to its weakest level since December 2002 at 1.0161 on Wednesday. Unless the pair manages to rise above 1.0200 and start using that level as support, additional losses could be witnessed in the near term.
Relentless dollar buying amid recession fears continued on Wednesday and the US Dollar Index reached its strongest level in nearly two decades above 107.00. The minutes of the Federal Reserve's June policy meeting showed late Wednesday that policymakers reiterated high inflation warranted 'restrictive' interest rates, with the possibility of a 'more restrictive stance' if inflation persists.
With risk flows returning to markets in the European trading hours, the greenback is having a difficult time gathering further strength and allowing EUR/USD to stay relatively calm.
Later in the session, the European Central Bank will release the Monetary Policy Meeting Accounts for June. According to Reuters, the market positioning shows that the ECB is now expected to hike its policy rate by a total of 135 basis points by the end of the year, compared to 190 bps in mid-June. Investors are reassessing the ECB's rate outlook as the energy crisis is expected to cause the economy to tip into recession.
In the second half of the day, the US economic docket will feature the weekly Initial Jobless Claims and May Goods Trade Balance data. In case Wall Street's main indexes stage a decisive rebound, EUR/USD losses could remain limited. The pair, however, is unlikely to break out of its downtrend in the current market environment.
EUR/USD Technical Analysis
EUR/USD remains technically oversold in the short term with the Relative Strength Index (RSI) indicator staying below 30. 1.0200 (psychological level, static level) aligns as initial resistance and in case the pair manages to flip that level into support, it could extend its recovery toward 1.0250 (upper limit of the descending regression channel, static level).
On the downside, 1.0160 (multi-decade low set on Wednesday) forms interim support ahead of 1.0130 (static level from November 2002, former resistance) and 1.0100.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.