EUR/USD Seeks Support After Dip Below 1.0900

EUR/USD Seeks Support After Dip Below 1.0900: Technical Analysis and Market Dynamics

In European trading on Wednesday, EUR/USD is on a recovery path after dipping below the 1.0900 level, finding support in the 1.0860 area. The Euro is in search of a stable footing, aiming for a potential pullback.

Technical Analysis:

A closer look at the technical analysis reveals a notable rebound in the price, aligning with the dynamic trendline and the 61.8% Fibonacci area. This pattern mirrors past instances, indicating the significance of this confluence. Furthermore, in the H4 timeframe, the price appears to be emerging from the oversold RSI zone, suggesting a potential shift in momentum. Investors are keenly watching upcoming data releases, particularly the USD Core Retail Sales and the USD Industrial Production m/m, which are expected to influence market sentiment.

Market Dynamics:

Mixed perspectives on inflation and interest rates from European Central Bank (ECB) policymakers are adding to the factors influencing the shared currency. This nuanced stance contributes to the observed downward pressure on the EUR/USD pair.

Forecast:

Despite the challenges, our forecast for EUR/USD remains bullish. The technical indicators, combined with potential market drivers, suggest a favorable outlook for the Euro against the US Dollar. Investors will be closely monitoring developments to gauge the sustainability of this recovery and any potential shifts in market sentiment.


Our preference

Long positions above 61.8% Fibo with targets at 1.10170 & 1.1140 in extension.