Oct 15, 2022

VOT Research Desk

As we approach the close, the EUR/USD pair is trading at about 0.9730 and has been unchanged for the week. As market participants anticipated major US developments, volatility generally stayed low throughout the first half of the week.

While the various pronouncements sparked some frantic trading across financial boards, they were unable to have a significant impact on the USD trend. Little substance for a EUR/USD rise is provided by the fiscal outlook. The pair has indeed recorded a lower low and a lower high, which is typically seen as a bearish indicator, according to the weekly chart.

Technical indicators continue to be in the red, with the RSI grinding downward at approximately 29 while the Momentum is correcting higher.

The same chart demonstrates that the pair, which is presently trading at approximately 0.9990, is still below a falling trend line drawn from this year’s high at 1.1494 while the 20 SMA continues to run parallel to the trend line, a few pips above it, signaling continued selling activity.

The daily chart reveals that sellers started to show up recently at a bearish 20 SMA, which is now at about 0.9790. Above it, the lengthier moving averages continue to move south in keeping with the prevailing trend.

Momentum indicator is now still in positive territory with a slight bullish slope, but RSI indicator is already moving down and below its midline, skewing the risk to the downside without really confirming it. If the weekly low at 0.9630 is broken, there may be a further slide with a test of the 2022 low at 0.9535 as the next target.

The 0.9400 level is the next significant support level and a potential bearish target below the latter.

A corrective rally might be initiated by steady advances over 0.9800, but the closer the pair comes to the aforementioned trend line, the greater the likelihood of a significant drop.

Oct 08, 2022

VOT Research Desk

EUR/USD pair temporarily traded above the 61.8% Fibonacci retracement of the 1.0197/0.0535 decline, which was at 0.9945, but it ended the week below the 38.2% retracement at 0.9790, indicating that the corrective gain may have peaked.

In the next days, it’s possible that the pair may retest and perhaps break below the lower end of the range.

A negative continuation in the near future is also supported by the fact that the pair also failed right before the daily falling trend line from the year high at 1.1494 on the weekly chart.

The 20 SMA continues to be much below the longer ones and above the trend line with a sharp downward slope. While this is going on, technical indicators continue to lack directional strength at oversold values. The risk is weighted to the downside on a daily basis.

According to the analysis, selling pressure on EUR/USD is anticipated to continue in the coming weeks. In each of the historical periods under consideration, bears predominate. From now until the end of the year, the pair is expected to remain flat around 0.97.

The EUR is seen in a negative light on the Overview chart. The three moving averages continue to fall, picking up speed as they do so and hitting new annual lows. The monthly and quarterly views, which are more pertinent, reveal that a growing percentage of market players are currently projecting lower lows for the year under 0.9500, with probable slides down to 0.9000.

All of the moving averages for the pair are trading below their downward-trending averages. Technical indicators, however, have failed to overcome their midlines and have started to decrease again inside negative levels.

At about 0.9690, the 23.6% retracement of the aforementioned daily decline offers immediate support. Prior to the multi-year low of 0.9535, the 0.9600 level is the next level to keep an eye on.

Sellers will probably now hold off until 0.9870 and 0.9945 before parity. Even if the pair moves back above the latter, clearing the trend line at about 1.0050 would be necessary to prevent a collapse.