EUR/USD Analysis

• 27 March, 2024 Ruchit Thakur

EUR/USD Analysis

Morning Update: Will the EUR/USD pair fall further or recover from its current level of 1.0850 ?

The EUR/USD pair is trading below the 200 DMA on the weekly chart, having encountered substantial resistance near 1.1150. Since EUR/USD is 58% weighted in DXY, the decline in EUR/USD was mostly caused by the Dollar Index's rapid recovery. As previously stated in our study, the Dollar Index was trading within a strong support zone of 100.50-100.80 before surprisingly surging. 

• Following a substantial decline, the EUR/USD fell below the 200 DMA. 
• The chart shows that both the trendline and the 200 DMA have forcefully rejected the EUR/USD pair; therefore, the price is expected to fall between 1.0500 and 1.0350.
• The weekly chart's 200 DMA is approaching 1.1150, where it will encounter trendline resistance, implying further losses in the EUR/USD market.

The accompanying chart depicts the EUR/USD's resistance and position relative to the weekly 200 DMA. The EURUSD is down sharply, trading at 1.0900, with trendline resistance at 1.1150. We forecasted in our DXY analysis that the Dollar Index would rise beyond its current trading range of 100.50 to 100.80, which serves as a strong support zone. Because EUR/USD and the Dollar Index have a negative correlation, rising DXY leads EUR/USD to fall, and vice versa. As a result, the DXY gain accounted for the majority of the EUR/USD fall.

The EUR/USD pair might go much more, with the 1.0700 and 1.0500 levels providing support for additional losses. As previously said, the EUR/USD and Dollar Index are inversely connected, therefore DXY might rise to 105.50 and 107.00, respectively. Because the EUR/USD is weak and falling, every increase represents a selling opportunity. 

Please check the EUR/USD weekly support and resistance levels. Spot charts are used to depict each stage.