EURUSD: Bearish shorterm - deep analysis (09.12)
The analysis of EUR/USD for the upcoming week, based on recent trends and forecasts, suggests the following key points:
Recent Trend and Diverging Monetary Policies: The EUR/USD pair has experienced a significant decline, falling over 6% from its peak in mid-July to lows around 1.05. This trend is driven by the strength of the USD and a deteriorating economic outlook for the Eurozone. The divergence in monetary policies between the Federal Reserve and the European Central Bank (ECB) has been a crucial factor, with the Fed planning further rate hikes and the ECB potentially ending its rate-hiking cycle.
Short-Term Outlook: For the fourth quarter of 2023, institutions project a moderately bullish outlook for EUR/USD, with an expected rate of 1.06-1.07 by the end of the year. However, some banks anticipate a softer Euro in early 2024, with potential lows around 1.0200.
Technical Analysis: The EUR/USD pair is currently bearish, with buyers defending the 1.0900 threshold since late July. The weekly chart indicates a critical support zone at 1.0500-1.0600. This area is significant from a technical perspective, but it remains at risk of breaking down. If sentiment improves, a rebound is possible, with key resistance levels at 1.0630 and 1.0830.
Market Sentiment: Despite the bearish trend, there's a notable decline in bearish interest. The spread of possible targets for EUR/USD widens, with most bets in the 1.0600/1.0900 range for a wider view, and 1.0400/1.0700 in the monthly perspective.
Given this analysis, the EUR/USD pair shows signs of bearishness in the near term, influenced by the monetary policy divergence and economic outlooks of the U.S. and Eurozone. However, there are possibilities for a moderate recovery depending on the evolving economic data and market sentiment.
Recent Trend and Diverging Monetary Policies: The EUR/USD pair has experienced a significant decline, falling over 6% from its peak in mid-July to lows around 1.05. This trend is driven by the strength of the USD and a deteriorating economic outlook for the Eurozone. The divergence in monetary policies between the Federal Reserve and the European Central Bank (ECB) has been a crucial factor, with the Fed planning further rate hikes and the ECB potentially ending its rate-hiking cycle.
Short-Term Outlook: For the fourth quarter of 2023, institutions project a moderately bullish outlook for EUR/USD, with an expected rate of 1.06-1.07 by the end of the year. However, some banks anticipate a softer Euro in early 2024, with potential lows around 1.0200.
Technical Analysis: The EUR/USD pair is currently bearish, with buyers defending the 1.0900 threshold since late July. The weekly chart indicates a critical support zone at 1.0500-1.0600. This area is significant from a technical perspective, but it remains at risk of breaking down. If sentiment improves, a rebound is possible, with key resistance levels at 1.0630 and 1.0830.
Market Sentiment: Despite the bearish trend, there's a notable decline in bearish interest. The spread of possible targets for EUR/USD widens, with most bets in the 1.0600/1.0900 range for a wider view, and 1.0400/1.0700 in the monthly perspective.
Given this analysis, the EUR/USD pair shows signs of bearishness in the near term, influenced by the monetary policy divergence and economic outlooks of the U.S. and Eurozone. However, there are possibilities for a moderate recovery depending on the evolving economic data and market sentiment.