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Euro Currency is Retracing Gains from 1.1975

Euro

The euro currency is looking to complete retracing its gains lower against the U.S. dollar. The EUR/USD Forex market looks ready to challenge the downside support level and one hundred percent Fibonacci level at 1.1703. This would complete the correction lower as the overall price action is within a downside trend channel since the 25 June high price point at 1.1975.

The euro area’s economic calendar is busy on Monday. Germany will publish June’s Ifo business sentiment index data. The European Union is releasing monthly Ifo sentiment survey expectations.

The United States will publish monthly housing data and the Dallas branch of the Federal Reserve Board will release their monthly manufacturing index. The United Kingdom has no economic data scheduled for publication on Monday.

Daily Euro Currency Technical Analysis (EUR/USD)

Looking at the above daily MT 4 price action chart, the euro currency looks primed for more losses as the U.S. dollar continues to look stronger. The EUR/USD currency exchange rate has now seen four straight weeks of losses. The short term twenty (20) day simple moving average also looks bearish.

Also of note, the technical indicators are also looking bearish for the euro currency. The 14 day MACD histogram and relative strength index (RSI) are maintaining their bearish slopes and are in negative territory.

The bearish 20 day simple moving average is at the top of the price range and the 100 day simple moving average has crossed below the 200 day simple moving average. The RSI is near oversold territory.

The first downside barrier lines up at 1.1750 with the next layer of technical support coming into play at 1.1702. The next downside barrier lines up at the key 1.16 level with 1.1470 then coming into play.

On the upside, there is technical resistance lining up at 1.1840. The 61.8 Fibonacci level lines up at 1.1920 with the psychological level at 1.20 then coming into the picture.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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