Good day everyone.
How is your forex trading? I hope everyone is making money. Do remember that forex is never about getting rich fast. Proper money management is important.
In the previous EUR/USD forecast we noted that the currency pair was at a critical level. Bullish success in overcoming the resistance might open up 1.16 while a bearish rejection would send the EUR/USD back to the long holding channel.
Looking at the EUR/USD chart above we note that the currency pair had dipped below the critical support and resistance region.
As expected 1.16 was tested but the bullish momentum burned out. As it is now within the previous channel range, we can expect familiar support and resistance targets.
We remain optimistic towards our bollinger bands as indicators of support and resistance. Any bullish recovery will likely test 1.14 before opening up 1.16. The immediate bearish target is 1.12 which is also the area of the middle bollinger band.
Sentiments are rallying behind a better than expected US retail sales. It came in at 1.3%. Many traders see this as an indication that the prospect of an interest rate hike is higher. US dollar demand increased, pushing the EUR/USD lower.
Over in the Euro Zone, lingering concerns such as Greece or a Britain exit from the union surface from time to time dampening sentiments.
We need to continue monitoring the various economic releases as the movement of the currencies remain largely sentiment driven in the short term. A better than expected US unemployment claim next week is likely to add to the interest rate hike prospect.