The EUR/USD went into the weekend within sight of short-term highs, which challenged values not seen since June of 2022.
Optimistic bullish speculators who have been pursuing upwards momentum in the EUR/USD may be feeling good about their perspectives. The EUR/USD went into the weekend near the 1.05400 mark, which approached short-term highs seen earlier on Friday. The ability of the EUR/USD to climb incrementally and sustain value has mirrored the results of the broad Forex market as the USD continues to exhibit weakness against many currencies it is paired against.
Traders who remain bullish and believe more upside momentum is going to be generated in the days ahead cannot be faulted, but at some point the price velocity higher may start to run out of it jet-like fuel. The EUR/USD certainly seems like it has put worries about values of parity and below the 1.00000 juncture into the past. The question now for speculators is where the behavioral sentiment will take the EUR/USD.
Confirmation of the U.S Federal Reserve Outlook has been Positive for the EUR/USD
On Wednesday of last week the EUR/USD, like many of its Forex counterparts, was near a low as the 1.02900 came within sight. However much to the delight of bullish EUR/USD traders, U.S Federal Reserve Chairman Powell then delivered a speech saying U.S interest rate policy was likely to change and become less aggressive. The confirmation of a ‘softening’ of the hawkish central bank mandates the U.S has been pursuing certainly caused a buying surge within the EUR/USD.
Resistance levels quickly became targets above and proved vulnerable. Once the 1.04900 ratios started to be flirted with which had last been seen on Monday of last week, the EUR/USD started to show a sustained ability to maintain its higher values on Thursday and Friday before going into the weekend. The EUR/USD climbed above the 1.05000 late last week for the first time since about the 29th of June.
Trading this coming week will be intriguing early on, if the EUR/USD stays above the 1.05000 mark this could be a sign financial houses are comfortable with this price and do not think the currency pair is overbought.On the 3rd of November, the EUR/USD was trading near the 0.97300 level, its upwards climb since this low has been solid and incremental. The outlook among financial houses now may believe values near the 1.06000 ratios are legitimate targets.
EUR/USD Weekly Outlook:
Speculative price range for EUR/USD is 1.03700 to 1.07840
If the EUR/USD doesn’t suffer a strong reversal lower early this week this could be viewed as a positive sign for bullish speculators. Certainly the EUR/USD will experience reversals lower, but it is a question of volatility. If the EUR/USD sustains its 1.05000 level without suffering lower depths that would be very interesting, but it is more likely that the 1.04700 to 1.04500 see some type of challenge. If the EUR/USD were to break below this 1.04000 mark this wouldn’t be the end of the bullish trend the EUR/USD has begun to demonstrate.
Realistic support looks to be strong around the 1.03700 mark. Traders who are bullish but conservative may want to use the lower support ratios as locations to ignite buying positions to wager.
The EUR/USD has achieved a rather solid climb higher the past two months, but it has not come without a fight. Risk management remains a key ingredient for day traders who want to pursue upwards momentum. Also important is the consideration that the climb in the EUR/USD has seen significant gains in the past couple of days, this could run into a short-term selling reaction from financial institutions which think the move higher was too fast and overdone.
However, if the 1.05000 sustains its price value and behavioral sentiment remains more optimistic regarding U.S Federal Reserve interest rate policy, the EUR/USD could have further room to move higher. Traders should remain realistic and not aim for the moon, but if the 1.06000 juncture is tested and penetrated higher, technical charts may cause speculators and financial institutions to believe values from the first and second week of June may be attractive.