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In the previous EUR/USD forecast we noted that the currency pair attempted to recover from it bearish dip. It was within the bottom and middle bollinger bands and both would serve as support and resistance respectively for the new week.
Looking at the EUR/USD weekly chart above we note that the currency pair was again bullish for the week. It is now approaching the middle bollinger band and this may be an area of test for the upcoming week.
1.3680 is also a common resistance region and hence we need to consider it in our trading plans.
The bottom bollinger band remains as our target for any bearish dip.
With the lower interest rate for the euro zone, the euro currency has lost much of its appeal as far as carry trade positions are concerned. The Ukraine crisis is not over and remains an uncertainty for the region. As far as the economic situation of the euro zone goes, the challenges of countries such as Spain remain.
As we consider the above, it is likely that we will not see a massive upwards drive of the euro currency. Furthermore the European Central Bank had suggested before of the belief that an overly strong currency may hurt exports and hence the markets may be hesitate to embark on a bullish push too.
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