EUR/USD Forecast Video for 23.02.23
Euro vs US Dollar Technical Analysis
The Euro has gone back and forth during the trading session on Wednesday, as we are sitting just above the 1.06 level. The area has been important more than once, and we are currently stuck between the 50-Day EMA above, as well as the 200-Day EMA below. Now that we are between those 2 moving averages, one would anticipate that this should be a lot of choppy and sideways action, which does make a certain amount of sense considering that nobody really knows what to do with the idea of the Federal Reserve policy.
Speaking of the Federal Reserve policy, it’s worth noting that we have the FOMC Meeting Minutes coming out during the late Wednesday session, therefore people will get an idea of what the Federal Open Market Committee is going to do going forward. After all, there seems to be a huge argument as to whether or not the Federal Reserve is going to continue hiking, and more importantly, just how long they are going to keep rates high. Ultimately, it’s very unlikely that we are going to see anything easy, but if we do break down below the 1.05 level underneath, it’s likely that we could see a huge move lower. That would not only take out a bit of support, but it could also kickoff a “FOMO trade” to the downside as it would open up an air pocket. At that point, I believe you would see the market drop down to the parity level rather quickly.
The alternate scenario is that we try to rally from here, perhaps trying to get back to the 1.08 level. The 1.08 level is an area that has seen a lot of resistance previously, and of course is just below that massive selloff that I have circled on the chart. Because of this, I think that any significant rally from here will offer a nice selling opportunity on signs of exhaustion. Nonetheless, we have to keep in mind that if for some reason the Federal Reserve seems to be soft in that documentation, could very well send this market much higher. Expect volatility and therefore keep your position size reasonable.
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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Source: https://finance.yahoo.com/news/eur-usd-forecast-euro-threatening-135730854.html