EUR/USD Daily Forecast – Resistance At 1.1660 Stays Strong
Euro Is Losing Some Ground Against U.S. Dollar
EUR/USD has recently made another attempt to settle above the resistance at 1.1660 but failed to develop sufficient upside momentum and pulled back while the U.S. dollar gained some ground against a broad basket of currencies.
The U.S. Dollar Index has recently managed to get above 93.60 and is moving towards the nearest resistance level at 93.75. In case EUR/USD gets to the test of this level, EUR/USD will find itself under more pressure.
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Yesterday, EU reported that Euro Area Inflation Rate increased by 0.5% month-over-month in September. On a year-over-year basis, Euro Area Inflation Rate grew by 3.4%. Euro Area Core Inflation Rate increased by 1.9% year-over-year. All inflation reports met analyst expectations and had minimal impact on EUR/USD dynamics.
Today, foreign exchange market traders will focus on the flash reading of Euro Area Consumer Confidence report for October. Analysts expect that Euro Area Consumer Confidence declined from -4 in September to -5 in October as news about high natural gas prices put pressure on consumer mood ahead of the winter.
Technical Analysis
EUR/USD remains in the range between the support level at 1.1630 and the resistance level at 1.1660. The resistance at 1.1660 has already been tested several times in recent trading sessions and proved its strength.
In case EUR/USD manages to settle above the resistance at 1.1660, it will move towards the next resistance level which is located at the 50 EMA at 1.1680. A move above the 50 EMA will lead to a test of the resistance at 1.1690. If EUR/USD gets above this level, it will head towards the next resistance level at 1.1720.
On the support side, a move below the support at 1.1630 will push EUR/USD towards the next support level at 1.1610. In case EUR/USD manages to settle below the support at 1.1610, it will continue its downside move and head towards the next support level which is located at 1.1580.
For a look at all of today’s economic events, check out our economic calendar.