Euro Sitting on Support

Published: Apr 5, 2022, 13:50 UTC•2min read

The Euro has initially tried to rally on Tuesday but gave back gains rather quickly. However, the 1.0950 level continues to offer short-term support.

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EUR/USD

-0.06

Euro vs US Dollar Technical Analysis

The Euro has initially tried to rally during the trading session on Tuesday but gave back gains rather quickly to show signs of hesitation. By doing so, the market looks as if it is going to continue to struggle overall, but the minor support that we are sitting at does suggest that we could go down to the 1.0850 level if we do in fact break down from there. On the other hand, if we can turn around a break above the top of the candlestick, then it is possible that we could go to the 50 Day EMA.

The market has been in a downtrend for quite some time, so do not be surprised at all to see sellers every time we rally. The downtrend makes a lot of sense because quite frankly there is nothing going on in the European Union right now that suggests that we are more likely than not to continue falling, because of a lack of energy, and an almost guaranteed recession in Germany at this point. Furthermore, we also have the Federal Reserve that is ready to get aggressive, therefore raising rates and driving the US dollar higher. I think we are in a very tough situation right now because the 1.0850 level underneath is the beginning of massive noise extending down to the 1.07 level that is visible multiple times over the years.

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On the upside, we have the 50 Day EMA that sits at the 1.1125 level and is drifting lower. This is an indicator that a lot of people pay close attention to, so it should be thought of as potential dynamic resistance.