- The EUR/USD pair reached a dynamic support, so a temporary rebound is natural.
- Only a major bullish pattern here could announce a new swing higher.
- A temporary rebound could bring new selling opportunities.
The EUR/USD forecast sees the pair turning to the upside after making a false breakdown through a dynamic support. Also, the USD is weakened by the DXY’s retreat. The Dollar Index climbed as much as 96.25 level today where it has found resistance.
The currency pair was somehow expected to rebound after its massive drop. Still, don’t forget that the bias remains bearish and that the price could drop anytime again. In the short term, it could recover a little before dropping deeper.
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Today, the Euro-zone data came in mixed. The Final CPI registered a 4.1% growth matching expectations, while the Final Core CPI registered only a 2.0% growth versus 2.1% expected. Furthermore, the Italian Trade Balance was reported higher at 2.45B versus 2.07B expected and compared to 1.32B in the previous reporting period.
Later, the United States is to release its Building Permits which is expected at 1.63M above 1.59M in the previous reporting period, while the Housing Starts could jump from 1.56M to 1.58M. Also, you have to be careful as the FOMC members’ speeches could bring high volatility.
From the technical point of view, the Dollar Index is in a corrective phase, but don’t forget that the Canadian inflation data will have a big impact on the DXY today.
EUR/USD Forecast: Price Technical Analysis – Pin Bar
The EUR/USD pair registered only a false breakdown with great separation below the descending pitchfork’s lower median line (LML). Now is struggling to stay above the 1.13 psychological level. Still, the downside pressure remains high as the Dollar Index could resume its growth.
Personally, I would like to see a new lower median line (LML) retest before really starting to grow. Only a strong bullish pattern here could signal a swing higher. The channel’s downside line stands as a dynamic resistance.
A temporary rebound could bring new short opportunities. The bias is bearish, so I will look for new short opportunities. 1.1239 is seen as a potential downside target is the rate continues to drop.
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