EUR/USD is consolidating its recovery process but remains below 1.0700 at the start of the European trading session on Thursday. The US dollar (USD) continues to decline despite political turmoil in the Middle East.
However, in the future, the weakness of the Eurozone economy, along with the potential recovery of the US economy, boosts expectations for a stronger USD in the medium term. Considering the possibility of the European Central Bank (ECB) lowering interest rates before the Federal Reserve (Fed), confidence in the strength of the USD is further reinforced. In such a scenario, EUR/USD is expected to face stronger downward pressure in the short term.
The 4-hour chart shows that the downward trend is encountering resistance around 1.0600. Prices have crossed above the 20-period Simple Moving Average (SMA), and if the recovery momentum continues, prices could advance and touch the SMA 50 before undergoing a period of strong downward correction.
However, in the future, the weakness of the Eurozone economy, along with the potential recovery of the US economy, boosts expectations for a stronger USD in the medium term. Considering the possibility of the European Central Bank (ECB) lowering interest rates before the Federal Reserve (Fed), confidence in the strength of the USD is further reinforced. In such a scenario, EUR/USD is expected to face stronger downward pressure in the short term.
The 4-hour chart shows that the downward trend is encountering resistance around 1.0600. Prices have crossed above the 20-period Simple Moving Average (SMA), and if the recovery momentum continues, prices could advance and touch the SMA 50 before undergoing a period of strong downward correction.
