EUR/USD Forecast Video for 22.02.23

Euro vs US Dollar Technical Analysis

The Euro has fallen a bit during the trading session on Tuesday, as we continue to see a bit of softness in the common currency. The 1.06 level is an area that I think should offer a bit of support, and the 200-Day EMA sits below there. For what it is worth, the 200-Day EMA also sits right around a swing low that I think is rather important, especially as it is also the 1.05 level, which obviously has a lot of psychology attached to it. Because of this, I think you get a situation where there will be buyers underneath, but it will remain to be seen whether or not they can keep the euro higher.

Keep in mind that the European Union has a much more precarious economic outlook than the United States, so it does make a certain amount of sense that we see the market drop. Nonetheless, there had recently been a huge trade betting on the Federal Reserve cutting back interest rates, although they have steadfastly denied that. At this point, it is going to come down to whether or not the market will be bothered believing the Federal Reserve, or if they will go ahead with their own narrative. As things stand right now, the Federal Reserve has been remarkably consistent with its messaging, yet it is probably worth noting the traders have been remarkably consistent with their wishful thinking.

With that being said, if we do bounce from this general vicinity, I think the 1.08 level above offers resistance. It’s also worth noting that there was a huge sell off a couple of weeks ago, the type of selloff the very rarely happens in a vacuum. With that, it’s very likely that the Euro will continue to see some downward pressure.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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