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Trends & Analysis
News

USD gains amid Fed rate cut speculations

News

Is the silver squeeze back?

News

Li Auto’s stock hits a speedbump on Q1 results

News

Gold closes week higher on rate cut speculations

News

Week Ahead Preview: 20th of May

News

Walmart’s stock hits record high on Q1 results

Asset Watch

Is the EUR/USD in trouble?

Tuesday, May 30, 2023

With the U.S. economy holding up better than expected and Fed officials still singing a hawkish tune, the EUR/USD may be on the cusp of further weakness. Credit Suisse analysts wrote on May 24:
“EUR/USD maintains its decisive rejection from the top of the shallow uptrend channel from the beginning of January and with support from the 55-DMA removed, this should confirm a more important downturn. We thus stay tactically negative looking for a fall to support next at 1.0729/14 and eventually the lower end of the channel, now at 1.0550.”
As the currency pair’s bull market faces major jeopardy, a climax could be close. For example, the EUR/USD’s 20-week moving average has acted as support and resistance for many months. And with rejections present throughout 2022, bear market rallies ended near the key level.

In contrast, the EUR/USD bounced off its 20-week MA several times in February and March 2023, which kept its recent bull market intact. However, a breakdown has occurred, as last week’s intraweek rally above the 20-week MA quickly reversed and the currency pair closed lower.

Right now, trendline support is the last line of defence. The upward-sloping grey line on the right side of the chart provided bullish relief in October 2022 and will need to hold for the currency pair to avoid a larger drawdown.

So, are the EUR/USD’s best days in the rear view, or will it recapture its 20-week MA?


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