EUR/USD still bearish after touching last weeks low of 1.06290 level. EURZONE CPI and other Important central bank decisions hold this week.
On September 21, 2023, several key events are scheduled that could influence the EUR/USD pair.
Bank of England (BoE) Interest Rate Decision (UK): The previous interest rate was 5.25%, and market consensus suggests a potential increase to 5.50%. A rate hike by the BoE reflects the central bank’s commitment to combatting inflation, and such a move could potentially strengthen the British Pound (GBP). Traders will closely monitor this event as it can impact the EUR/USD pair.
US Economic Data: On the same day, the US is set to release high-impact economic data, including Initial Jobless Claims and Existing Home Sales figures. A lower-than-expected jobless claims figure may support the US Dollar (USD), signaling a robust labor market. However, the housing market’s health, as indicated by a decline in home sales, could exert downward pressure on the USD.
The EUR/USD currency pair is currently exhibiting a complex set of technical indicators on the weekly timeframe. It is noteworthy that there is a bearish range momentum in this period, indicating an overall bias towards a bearish market sentiment. However, in the short term, there appears to be a contradictory trend as the price shows signs of bearishness.
The price is positioned below both the 50-day and 200-day moving averages, which are widely used as indicators of the overall trend. This positioning below these key moving averages suggests a sustained bearish trend.
Scenario 1 (Bullish): If the price continues its current upward movement, it could potentially retest the resistance levels in the range of 1.06889 to 1.06964. A successful retest of this range might lead to further upward momentum, targeting levels at 1.07273 and 1.07649. Should the bullish momentum persist, the price could climb higher, targeting the levels of 1.07792, 1.08004, and even 1.08231.
Scenario 2 (Bearish): Conversely, if the price reverses its course from its current levels, it may head lower to test the support level at 1.06505. A successful test at this level could open the door to further downward movement towards the 1.06359 level, followed by a more significant support level at 1.06099. Depending on market sentiment, there is a possibility of the price testing the range between 1.05867 to 1.05678, with 1.05449 serving as a major support level. A breach of these support levels could intensify the bearish pressure.
It’s important to note that in case of a strongly bearish market sentiment, the price may revisit the levels seen in the previous week, near the 1.07273 mark.
Key Levels to watch are 1.07892,1.06099,1.07273,1.05687,1.06700,1.06108