EUR/USD Price Forecast: About to challenge a critical long-term support

EUR/USD Current price: 1.1482

• Central US states are heading to the polls today to vote for Governors.
• European Central Bank officials failed to provide fresh clues on monetary policy.
• EUR/USD pressures fresh three-month lows, aiming to extend its slide.

The EUR/USD pair trades near a fresh three-month low of 1.1480, extending its slide amid persistent US Dollar (USD) strength. In the absence of relevant data, financial markets remain in a cautious mode, resulting in softer global indexes and a stronger US dollar.

Europe did not publish relevant data, while European Central Bank (ECB) officials who were on the wires failed to deliver fresh clues on monetary policy. ECB President Christine Lagarde spoke about the Eurozone at a conference hosted by the Bulgarian National Bank in Sofia, noting that currency changeovers can produce a temporary uptick in measured inflation. Additionally, ECB Christodoulos Patsalides, the Bank of Cyprus governor, stated that the European economy is showing resilience.

Meanwhile, multiple United States (US) states are undergoing their first relevant interim election since Donald Trump became President. New York, New Jersey, and Virginia are electing mayors, with some polls hinting at a potential Democratic victory. The results of these elections could accelerate a resolution to the ongoing federal shutdown, particularly if Republicans lose support.

EUR/USD short-term technical outlook:

In the 4-hour chart, EUR/USD is currently trading at around 1.1482, down for the day by about 31 pips. The risk skews to the downside, as a bearish 20 SMA at 1.1535 slides below the longer ones, in line with dominant downside momentum and hinting at additional slides ahead. The 100 SMA is also bearish, gaining downward traction above the shorter one at 1.1611, while the 200 SMA continues to fall at 1.1656, keeping resistance layered between 1.1535 and 1.1656 as sellers retain control. At the same time, the Momentum indicator remains decisively negative, while the Relative Strength Index (RSI) indicator has slipped into oversold territory near 28, extending the risk of continued weakness.

In the daily chart, EUR/USD is also poised to extend its slide. A bearish 20 SMA slides south and now sits below the 100 SMA, hinting at additional slides ahead; the 20 SMA stands at 1.1604, while the 100 SMA is flat at 1.1665. Finally, the Momentum indicator has deteriorated, printing a sequence of lower readings and reinforcing selling interest, while the RSI slid to 32.7 and continues to edge toward oversold territory, supporting the bearish bias. Failure to recover beyond the 1.1500 mark initially exposes 1.1470 as a long-term static support level. Once below it, a steeper decline is likely to follow.

(This content was partially created with the help of an AI tool)