EUR/USD Signal
I’m initiating a short position on EUR/USD immediately. Stop-loss is placed at 1.0510, targeting a move down to 1.0250. Due to upcoming economic releases, this trade will be executed with half the usual position size.
Market Overview
The Euro rallied significantly during Wednesday’s trading session. It encountered resistance at the 50-day EMA before pulling back slightly. Traders closely watch the 50-day EMA, though it’s not a definitive barrier. Significant resistance above it may challenge the Euro. This substantial resistance zone spans from the current level up to 1.06 and presents a nearly 200-pip hurdle.
Economic Influences
The EUR/USD market remains volatile. Expect major influence from Friday’s Non-Farm Payroll data on the US Dollar. Wednesday’s Services PMI, while below expectations at 52.8, remains in expansion territory, indicating underlying strength. The market seems to be consolidating within a major range.
Technical Outlook
Technical analysis leans bearish for the Euro. The 1.05 level presents resistance, as does the 50-day EMA. A break above 1.05 will likely face renewed selling pressure up to 1.06. The European Union’s economic struggles and the Federal Reserve’s stance against rate cuts favor further downside. Technical indicators above the current price point will likely be respected by traders.
Potential Bullish Scenarios
A daily close above 1.06 is needed to signal a bullish reversal. Alternatively, an unexpected emergency rate cut by the Federal Reserve could spur buying interest in the EUR/USD pair.
Ready to trade the EUR/USD Forex analysis? Here’s a list of some of the top forex brokers in Europe to check out.