EUR/USD Daily Forecast – Test Of Resistance At 1.1880

Euro Tries To Rebound Against U.S. Dollar

EUR/USD is currently trying to settle above the resistance at 1.1880 while the U.S. dollar is gaining some ground against a broad basket of currencies.

The U.S. Dollar Index is currently trying to settle below the support at 92.15. RSI is in the overbought territory so the risks of a pullback are increasing. In case the U.S. Dollar Index manages to settle below the support at 92.15, it will gain additional downside momentum and head towards the next support at 92.

No important economic reports will be released in the U.S. and EU today so foreign exchange market traders will focus on general market sentiment which remains bullish for the U.S. dollar.

The market is worried that Fed will start raising rates in 2022, while it was previously expected to push rates higher in 2024. Riskier assets have been under material pressure in recent trading sessions which provided support to the American currency. In addition, it looks that too many traders bet against U.S. dollar, and the sudden change in Fed’s tone caught them by surprise.

Technical Analysis

EUR/USD has recently made an attempt to settle below the support at 1.1860 but failed to develop sufficient downside momentum and rebounded towards the resistance at 1.1880.

In case EUR/USD manages to settle above the resistance level at 1.1880, it will head towards the next resistance which is located at 1.1900. A successful test of the resistance at 1.1900 will open the way to the test of the resistance at 1.1925.

On the support side, EUR/USD needs to settle below the support level at 1.1860 to have a chance to gain additional downside momentum in the near term. In case EUR/USD declines below the support at 1.1860, it will head towards the next support level which is located at 1.1830. A move below the support level at 1.1830 will open the way to the test of the next support at 1.1800.

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

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This article was originally posted on FX Empire