Good day forex traders.
Welcome to our weekly review of the EUR/USD currency pair. I hope your trading for the week was successful!
In the previous EUR/USD forecast we noted that the currency pair closed below 1.14. As forecasted, the continued downside pressure had weaken the resolve of 1.14. Therefore it would be critical because if the EUR/USD failed to climb up above 1.14, bearish momentum might build up. While the region consist of both 1.14 and the lower bollinger band as support, it was observed that the price action had been chipping away at it.
Looking at the EUR/USD weekly chart above we noted that the currency pair is bearish for the week. As mentioned in our midweek update, the resistance probably limited bullish manoeuvres and sent the currency pair down.
Should the bearish momentum continues, we may be looking at 1.12 as a medium term target. This is likely to be a significant region. The EUR/USD spent more than a month consolidating in that region back in May 2017.
If the bulls manage to stage a recovery, the middle bollinger band and 1.16 will likely be exerting resistance on the price action.
The US Federal Reserve left interest rates untouched as it reiterated it’s observations that the economy and employment market remains strong. The mention of a gradual interest rate increase came as no surprise and investors continued on with usual trading.
With the US mid term elections turning out to be somewhat a grid lock, investors are likely apprehensive. More monitoring is required.
Next week brings many economic data including US consumer price index and retail sales. These are important barometers of the economy’s health. Officials from both the US Federal Reserve and European Central Bank are due to speak too. Do remember to have proper money management to mitigate risks from unexpected developments.