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US Dollar Forecast: EUR/USD Stalls Ahead of January High

Article By: ,  Strategist
August 7, 2024 1:32 PM

US Dollar Outlook: EUR/USD

EUR/USD holds within the broad range from the first half of the year as the recent rally in the exchange rate seems to have stalled ahead of the January high (1.1046).

US Dollar Forecast: EUR/USD Stalls Ahead of January High

EUR/USD snaps the series of higher highs and lows from last week as it gives back the advance following the US Non-Farm Payrolls (NFP) report, and the rally from the monthly low (1.0778) may continue to unravel as the pullback in the exchange rate keeps the Relative Strength Index (RSI) below overbought territory.

However, EUR/USD may extend the advance from earlier this month should it continue to hold above the July low (1.0710).

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EUR/USD Chart – Daily

Chart Prepared by David Song, Strategist; EUR/USD on TradingView

  • The opening range for August remains in focus for EUR/USD as it continues to pullback from the monthly high (1.1009), but lack of momentum to hold above the 1.0860 (50% Fibonacci retracement) to 1.0880 (23.6% Fibonacci extension) zone may lead to a test of the monthly low (1.0778).
  • Failure to hold above 1.0770 (38.2% Fibonacci retracement) opens up the July low (1.0710), with the next area of interest coming in around the June low (1.0666).
  • Nevertheless, EUR/USD may attempt to retrace the decline from the monthly high (1.1009) if it continues to hold above the 1.0860 (50% Fibonacci retracement) to 1.0880 (23.6% Fibonacci extension) zone but need a close above the 1.0940 (50% Fibonacci retracement) to 1.0960 (61.8% Fibonacci retracement) region to bring the January high (1.1046) back on the radar.

Additional Market Outlooks

British Pound Forecast: GBP/USD Susceptible to Test of July Low

AUD/USD Forecast: RSI Falls Back into Oversold Zone

US Dollar Forecast: USD/JPY Selloff Pushes RSI into Oversold Zone

--- Written by David Song, Strategist

Follow on Twitter at @DavidJSong

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