EURUSD recovery with negative US Dollar correction

Intermediate
  • The surging US Dollar strength through mid-March has continued to reverse this week and over the past 24 hours.
  • This has reflected an easing of global funding and credit concerns, as global central banks, particularly the Federal Reserve in the US, have acted to provide global liquidity for US Dollars.
  • The corrective weakening of the US Dollar has been seen across most major currencies (except against the Japanese Yen).
  • Here we spotlight the Euro recovery, with EURUSD forming a base and more positive tone.

EURUSD day trade outlook: Risks still higher

A resilient consolidation Wednesday above 1.0743 support, and then a firm advance overnight above 1.0888, to build on Tuesday’s push up through our 1.0831/39 resistance area, plus Monday’s rebound from a new cycle low at 1.0633, to keep the risk higher into Thursday.

  • We see an upside bias for 1.0933 and 1.0947; a break above aims for 1.0982 and maybe towards key 1.1045.
  • But below 1.0862 targets 1.0782, which we would look to try to hold. Below targets 1.0743 and 1.0718.

EURUSD intermediate-term outlook

The mid-March selloff through key 1.0949 signalled an intermediate-term shift to a bear trend.

  • Downside risks We see an intermediate-term bear trend for 1.0650 1.0500, 1.0340, maybe 1.0000.
  • What changes this? Above 1.1045 switches the intermediate-term bull trend to neutral and above 1.1237 to a bull trend.

Daily EURUSD Chart

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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