U.S. Dollar Tries To Gain More Ground Against Euro

EUR/USD is currently trying to settle below the support at 1.1900 while the U.S. dollar is moving higher against a broad basket of currencies.

The U.S. Dollar Index is testing the resistance level at 92. In case this test is successful, the U.S. Dollar Index will move towards the next resistance level at 92.15 which will be bearish for EUR/USD.

There are no important economic reports scheduled to be released in the U.S. and EU today so foreign exchange market traders will focus on general market sentiment.

U.S. dollar continues to gain ground against a broad basket of currencies, and it looks that it is a major short squeeze. Too many traders were bearish on the dollar because of Fed’s dovish stance, and the sudden change in tone caught them by surprise. If this short squeeze continues, EUR/USD will find itself under more pressure.

Technical Analysis

EUR/USD managed to settle below the support at 1.1925 and is currently trying to settle below the next support level at 1.1900. RSI declined into the oversold territory after the recent sell-off, and the risks of a rebound are increasing.

In case EUR/USD manages to settle below the support at 1.1900, it will get to the test of the next support level which is located at 1.1880. A successful test of the support at 1.1880 will open the way to the test of the next support at 1.1860. If EUR/USD gets below this level, it will head towards the support at 1.1830.

On the upside, the previous support level at 1.1925 will serve as the first resistance level for EUR/USD. In case EUR/USD manages to settle back above this level, it will gain additional upside momentum and head towards the next resistance which is located at 1.1965. A move above the resistance at 1.1965 will push EUR/USD towards the next resistance level at 1.1990.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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