Euro aiming back up at 1.20 (EURUSD forecast)

Intermediate
  • A more positive EURUSD tone again through mid-September (as we highlighted in our report last week), having probed down and rebounded from just below important 1.1754/53 support (to reject a possible Head & Shoulders top pattern).
  • The subsequent bounce has reflected resurfacing US Dollar vulnerability since Wednesday’s Fed meeting (with a dovish tone from the FOMC).
  • Furthermore, with stock averages trying to rebound and move back to “risk on”, the US Dollar should stay weaker, which should assist EURUSD aiming back to the recent peak (1.2011) and psychological 1.2000 barrier (from where the ECB members “jawboned” the Euro lower earlier this month).

EURUSD day trade outlook: Still a rebound bias

An early Thursday sell-off overnight to just prod through important 1.1756/54/53 supports for a potential Head & Shoulders pattern, but then a firm bounce from just below here (from 1.1736), to overcome 1.1819 resistance for a further rebound bias for Friday. 

Day trade setup

  • We see an upside bias for 1.1862; a break here possibly aims for 1.1900 and 1.1917/29.
  • But below 1.1817 aims back for 1.1736 and maybe even opens risk down to the key 1.1697/94 area.

EURUSD intermediate-term outlook

The early June rally above 1.1147 set an intermediate-term bull trend.

  • Upside risks: We see an intermediate-term bull trend for 1.2414.
  • What changes this: Below the 1.1697/94 support area switches the intermediate-term bull trend straight to bearish.
6 Hour EURUSD Chart
6 Hour EURUSD Chart

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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