EUR/USD has rallied hard since March 2020. The EUR/USD is now trying to break below the 60-day moving average. DXY net short position is very high, and EUR's new long position in the future market is very high. Actually, the net long position is the highest among G7 currencies, so it's very prone to profit-taking or long position squeezing.
Fundamentally, the 10-year Treasury yield of US and 10-year yield of German Bunds spread has kept rising since Jun 2020, so it's time for the DXY to follow, and EUR is looking for a retracement. Yesterday's FOMC meeting changed the market sentiment that Fed is more optimistic about the economy, and People should be starting to square their short position in the dollar index.
As USD is a major trading currency and a major safe-haven currency, a 13% decline to 89.2, DXY since 2020 high should be marked as the temporary low.
The European Central Bank has the necessary tools, including interest-rate cuts, to prevent further strengthening of the euro undermining inflation, Governing Council member Klaas Knot said.
Technically, a five-wave upward moment from the March 2020 low is in place; the euro should look for a counter-trend correction, a 38.2% correction should be minimal if there is no sudden fundamental change in USD.
So Short EUR/USD and target for 1.17 for the profit.
Fundamentally, the 10-year Treasury yield of US and 10-year yield of German Bunds spread has kept rising since Jun 2020, so it's time for the DXY to follow, and EUR is looking for a retracement. Yesterday's FOMC meeting changed the market sentiment that Fed is more optimistic about the economy, and People should be starting to square their short position in the dollar index.
As USD is a major trading currency and a major safe-haven currency, a 13% decline to 89.2, DXY since 2020 high should be marked as the temporary low.
The European Central Bank has the necessary tools, including interest-rate cuts, to prevent further strengthening of the euro undermining inflation, Governing Council member Klaas Knot said.
Technically, a five-wave upward moment from the March 2020 low is in place; the euro should look for a counter-trend correction, a 38.2% correction should be minimal if there is no sudden fundamental change in USD.
So Short EUR/USD and target for 1.17 for the profit.
Comment:
As expected, 60 MA tested
Comment:
AS recommended back in the post, EUR reached 1.13 now