EUR/USD Technical Forecast: Unattractive Price Action So Far
The euro strengthened against the US dollar in the first quarter of 2023, briefly reaching its highest level since April 2022 in early February. As the risk-off mood erupted in global markets, the seller came back and saw the EUR/USD clearing the 1.1035 area, the key technical ceiling defined by the 50% Fibonacci retracement of the 2018/2022 decline. I can no longer.
Despite lacking strong bullish conviction, EUR/USD maintains a modest positive bias beyond late 2022 after overcoming 200 days of simple values and breaking long-term trendline resistance. increase. However, its gradual uptrend is not impressive, as the exchange rate constantly fluctuates as sentiment shifts.
Breakout opportunities may present themselves soon
There is no reason to believe that the situation will change significantly heading into Q2, as recent price action has yet to show signs of a meaningful and solid trend. That said, Snail’s pace up seems to be the euro’s baseline his scenario, at least for now.
The lack of EUR/USD volatility may prompt traders to turn their attention to other forex pairs in search of attractive trends or more attractive formations, but important technical levels are tested and clean. Interesting breakout opportunities can still occur if negated with a decisive move.
This article focuses on the EUR/USD technical outlook. If you want to know the basic outlook for the euro, click the link below to download DailyFX’s complete quarterly guide. It’s free!
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Key technical settings to watch
Focusing on a bullish setup, traders should look for a downtrend line extending from the May 2021 high (purple line). If the price breaks this dynamic resistance on the upside (1.0920), the bulls may launch an attack on the 2023 swing highs. At further strength, his attention shifts to the 1.1200 handle, then he shifts to 1.1392, his 61.8% Fib retracement of the aforementioned move.
In the case of a break-down triggered bearish formation, traders can focus on support near 1.0630. If this zone is breached, EUR/USD may fall towards 1.0515 in a short period of time. This looks like a very weak floor, so it could eventually collapse and he’s poised to drop towards the 200-day simple moving average near the 1.0350 mark.
EUR/USD weekly chart
Source: TradingView, by Diego Colman
|
change with |
longs |
shorts |
Oi |
| every day | -Ten% | -1% | -Five% |
| every week | -Five% | 1% | -1% |
