Euro Technical Forecast: EUR/USD Grinds at Support

Euro Technical Forecast: EUR/USD Weekly Trade Levels

• Euro plunges more than 4% off yearly high- attempting to snap four-week losing streak
• EUR/USD now testing major support pivot- EU / US inflation data, NFPs on tap
• Resistance ~1.0875, 1.0939, 1.1038/41 (key)– Support 1.0741/77, 1.0587-1.0641 (key), 1.0508

Euro is struggling to snap a four-week losing streak that has taken EUR/USD more than 4% off the yearly high. Price is now testing a key technical support zone, and the focus is on possible price inflection here with immediate decline vulnerable into the close of the month. Battle lines drawn on the EUR/USD weekly technical chart.

Euro Price Chart – EUR/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView

Technical Outlook: In my last Euro Technical Forecast we noted that, “six-day sell-off takes EUR/USD into confluent technical support and challenges the June uptrend. From a trading standpoint, rallies would need to be limited to the monthly open IF price is heading for a larger correction here with a close blow 1.0942 still needed to fuel the next leg lower.” Euro broke lower the following week with a four-week decline now testing a major pivot zone at 1.0741/77- a region defined by the 61.8% retracement of the October 2023 advance and the February low-week close (LWC). Note that the median-line of a proposed descending pitchfork also converges on this region and the focus is on possible price inflection into this zone.

Look for initial resistance long the 52-week moving average (currently ~1.0875) backed by the March high-week close (HWC) at 1.0939. Key resistance is now eyed at 1.1038/41- a region defined by the 61.8% retracement of the September decline, the December high-week close (HWC) and the 2024 objective yearly open. We’ll reserve this threshold as our bearish invalidation level.

A break / close below 1.0740 exposes the last line of defense for the bulls at yearly low-close / 2023 LWC at 1.0587-1.0641- losses below this threshold would suggest a more significant high was registered last month with subsequent support objectives eyed at the 2023 low-close near 1.0508 and the 2023 low at 1.0448.

Bottom line: EUR/USD is testing confluent support into the close of the month and while the medium-term threat remains lower, the immediate decline may be vulnerable here. From a trading standpoint, a good zone to reduce portions of short-exposure / lower protective stops – rallies should be limited to 1.0939 IF Euro is heading lower on this stretch with a close below 1.0740 needed to mark downtrend resumption.

Keep in mind we have key EU / US inflation data on tap into the close of the month with US non-farm payrolls slated for Friday. Stay nimble into the monthly cross and watch the weekly close here for guidance. Review my latest Euro Short-term Outlook for a closer look at the near-term EUR/USD technical trade levels.

Key Euro / US Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Weekly Technical Charts

• British Pound (GBP/USD)
• US Dollar Index (DXY)
• Australian Dollar (AUD/USD)
• Gold (XAU/USD)
• Japanese Yen (USD/JPY)
• Crude Oil (WTI)
• Canadian Dollar (USD/CAD)

--- Written by Michael Boutros, Sr Technical Strategist

Follow Michael on X @MBForex