EURUSD Possible HUGE Bullish Peak? READ FULL TEXT FX:EURUSD
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Welcome, traders! Make sure to follow my profile for regular market analysis. Today, we're diving into the technical analysis and forecast for the EURO versus the USD pair. So let's get started!
Here's my analysis for July 13-14 in the 1H Timeframe:
The EURO USD pair has taken off like a rocket after the release of the CPI data. The Euro's momentum seems unstoppable at the moment, and following the market trend is the only logical choice. If we take a look at the DXY, the Dollar Index, it's clear that sellers have dominated since the release of the Non-Farm Payrolls report (NFP).
The fall in the DXY continued even after the CPI data, and it broke through its last support level at 100.80. If the downward pressure persists, the DXY could head towards double-digit figures, indicating a weaker USD.
Examining the chart, we can see that 100.80 was the only support level on the DXY chart, and the price is currently trading below that level. If the fall continues and the market pressure remains, we can expect the DXY to face further challenges. The next resistance levels to watch out for are 100.1 and 100.
The situation looks quite challenging for the DXY right now, and based on the chart analysis, the fall is likely to continue. However, it's essential for traders, especially beginners, to avoid gambling with their trades. We have already witnessed several impactful news releases in recent days, and it's advisable to close all dollar positions before major news events to safeguard stop losses.
In extremely volatile markets, stop losses may not function properly due to slippage, so it's crucial to exercise caution and not take unnecessary risks with your hard-earned money.
Now, let's shift our focus to the EURO versus USD forecast.
The market structure for the EURO USD pair indicates a strong bullish trend, with the price currently near the top. In this type of market, buying on retracements should be the primary trading strategy to follow.
The fifty-day moving average is acting as a dynamic support for the market, indicating potential buying opportunities on pullbacks. However, given the current bullishness of the EURO USD pair, a significant decline might be unlikely in the short term. The next dynamic support level, the fifty-day moving average, is quite far away, around 1.060 and 1.050.
While theoretically, this level presents an ideal area for a buy position, the chances of the market coming down to this level in the near future are slim. Therefore, it's crucial to keep a close eye on this specific level and patiently wait for the market to show some downward movement over the next few days.
Considering the prevailing bullish momentum, there's a good possibility that the previous resistance level at 1.100 will now work as a support level for the EURO USD pair.
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If the market retraces and bounces from this level, it could present an excellent buying opportunity for traders. Therefore, it's important to keep this support level in mind and be prepared to take advantage of potential retracements. Buying on retracements remains the best trading strategy in this current market condition.
However, it's worth noting that the ideal level for a buy position, the fifty-day moving average, is relatively far away. This emphasizes the importance of managing risk strictly to protect your trading capital.
On the other hand, if the market doesn't experience a significant retracement and continues its upward move, traders can consider buying above 1.500. Nonetheless, it's crucial to adhere to strict risk management principles in such cases. When taking a buy position further away from the area of value, it's important to be cautious. In the event of a false breakout, strict risk management will help avoid significant losses. Consider using a smaller lot size to mitigate risk.
That's all for today, fellow traders. I hope this technical analysis and forecast for the EURO USD pair provided you with valuable insights. Remember, always follow proper risk management techniques and be a trader, not a gambler. Protect your hard-earned money and trade wisely.
Thank you for reading, and stay tuned for more market analysis and trading insights. Until next time, happy trading!
