Good day readers.
Welcome to the latest EUR/USD forecast. Here’s to a great year ahead!
In the previous EUR/USD forecast we noted that the currency pair tested the middle bollinger band again as per our previous forecast. The 1.1 region was shaping out to be a strong resistance. Having said so we need to monitor the shorter timeframe to observe as nothing is forever.
Should the resistance fail, we might see an attempt to achieve 1.12 by the bullish traders. Bearish recovery would likely target the 1.08 support region.
Looking at the EUR/USD weekly chart above we note that the currency pair was bearish for the week. The middle bollinger band was effective as a resistance. This is the fifth week that our technical analysis worked. 🙂
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The EUR/USD is now range bounded between 1.08 to 1.1020. No doubt any bearish or bullish momentum will need to breach the respective support and resistance.
As a new year begins, close monitoring of the shorter timeframes is recommended to determine the price action. We can use the lower and upper bollinger bands as possible extended targets.
The US unemployment claims came in higher than expected. As the job market is a crucial indication of the economy, it is closely monitored. Analysts will likely be looking for indications of the next US interest rate hike.
As both sides of the Atlantic diverge in their monetary policies, the continued easing stance of the European Central Bank may add dampening pressure to the euro currency.
Important economic events such as the US FOMC meeting minutes and US Non-Farm Payroll are due next week. Low volume market condition will likely persist.