- The focus of market participants has now shifted towards the release of the US CPI report for August.
- 50 days EMA (Exponential Moving Average – Red Line) is held at 1.1805.
- Forex trading market participants may look for a sell trade below 1.825 with an initial target of $1.1765 and $1.1725 levels.
The EUR/USD pair closed at $1.1808 after setting a high of $1.1818 and a low of $1.1769. The EUR/USD currency pair fell for the third consecutive session on Monday. It’s extending losses to its lowest level since August 27th. Thus, the free forex signals and forecast is to take a sell position in the EUR/USD pair below the 1.1822 level with a target of 1.1765.
If you are interested in trading EUR/USD with forex robots, check out our guide.
Despite the weakness in the US dollar, the currency pair EUR/USD dropped on Monday. The latest comments from a German member of the ECB. Isabel Schnabel has said that inflation will noticeably decrease as soon as next year and has weighed on the single currency euro, adding to the loss in the EUR/USD currency pair.
During early trading hours on Monday, the US Dollar Index, which measures the greenback’s value against the basket of six major currencies, rose to 92.89. It’s supporting the US dollar, which ultimately added pressure on the EUR/USD pair for the day. However, during American trading hours, the greenback faced pressure to fall at 92.6% and lost its gains that capped further losses in the EUR/USD pair.
Economic Data Review:
At 11:00 GMT, the German WPI dropped to 0.5% from the projected 0.8% on the data front in August. It weighed on the single currency euro and added further loss in the EUR/USD pair. The Italian Quarterly Unemployment Rate dropped to 9.8% against the forecasted 10.1% and supported the euro. Thus, it capitulated further losses in the EUR/USD pair.
From the US side, at 22:47 GMT, the Federal Budget Balance in August showed a deficit of-170.6B against the forecasted-260.5B and weighed on the US dollar, which caused a further decline in the EUR/USD pair.
The market’s risk appetite was also abated after the re-emergence of inflation fears worsened after Friday’s higher than expected US Producer Prices. The ongoing concerns around the progress of the Delta variant of coronavirus and its potential impact on the global economic recovery also added further pressure on risk-on market sentiment. As a result, it’s weighing on the riskier currency pair EUR/USD.
Bureau of Labor Statistics to report CPI m/m.
The focus of market participants has now shifted towards the release of the US CPI report for August. It’s expected to fall by 5.3% from July’s 5.4%. Investors believe that these CPI figures, scheduled to be released on Tuesday, will provide a clearer idea about tapering to Fed members.
The cautious behavior of investors ahead of the CPI report release kept the trade volume from US investors low in the market, which also added to the loss of the EUR/USD pair.
Free Forex Signals and Forecast – Daily Technical Levels
Support Resistance
1.1778 1.1827
1.17491.1847
1.1729 1.1875
Pivot Point: 1.1798
Free Forex Signals and Forecast – Sideways Channel Breakout
The EUR/USD is trading bearishly below the 1.1825 resistance mark. On the 4 hour chart, the breakout of the double bottom pattern is now operating as a resistance for the EUR/USD.
The formation of candles below the 1.1825 level could drive an additional selling trend until the 1.1750 support level. Furthermore, the EUR/USD pair is currently trading with a bearish bias at the 1.1825 level as investors are pricing in the weaker than expected CPI m/m from the US Bureau of Labor Statistics.
On the downside, the violation of the 1.1750 support level can drive the EUR/USD pair towards the 1.1725 and 1.1705 marks. The 50 days EMA (Exponential Moving Average – Red Line) is held at 1.1805. Thus, it’s supporting a selling trend in the EUR/USD pair.
The oscillator indicator, Stochastic RSI, holds in a selling zone, demonstrating the chances of a selling trade in EUR/USD.
EUR/USD Free Forex Signals and Forecast
The Forex trading market participants may look for a sell trade below 1.825 with an initial target of $1.1765 and $1.1725 levels.
Instrument: EUR/USD
Order Type: Sell Order
Entry price: 1.1825
Stop Loss: 1.1865 (40 Pips)
TP1: 1.1765(60 Pips)
TP2: 1.1725 (100 Pips)
Our Risk Setting: 1%
Risk / Reward Ratio: 1:1.75
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