What is the next move for the Euro?
|The chart below shows the eurusd which we believe has been in an impulsive move lower in a possible five-wave move. The five waves lower are not yet complete we are in the middle of wave four. We believe wave three is complete, and we are in the middle of a wave four higher.
We have labeled the current price action in a channel at 1.07000, which is also the 38.2 Fibonacci retracement. We would ideally like to see prices respect this level and impulsively continue to the downside to complete wave five. We have a target of 1.03000 as our possible wave five completion. We expect the euro to gain strength for the rest of 2023.
Inflation in Europe has continued to trend to the downside and we see the ECB holding rates stable for the rest of 2023. Energy costs continue to rise caused by conflict in the Middle East. If energy prices stay stable, we can see the euro gaining strength compared to the broader market.
Key news out this week: EURO 23rd October French Flash Manufacturing PMI, French Flash Services PMI, German Flash Manufacturing PMI, German Flash Services PMI, 25th October German Ifo Business Climate, ECB President Lagarde Speaks, 26th October Main Refinancing Rate, Monetary Policy Statement, ECB Press Conference
Res: 1.07000; 1.07580; 1.08300
Sup: 1.04000; 1.03600; 1.03000
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