Jump to content

EUR/USD FX price forecast: upside breakout in play


Recommended Posts

The EUR/USD forex pair has now confirmed an upside breakout in line with the longer-term trend, although the move sees the price trading in overbought territory.

bg_banca_IFIS_238725206.jpgSource: Bloomberg
 
 Shaun Murison | Senior Market Analyst, Johannesburg | Publication date: Friday 14 April 2023 

EUR/USD – Indicator analysis

14APReurusdmas.pngSource: IG

The 20-day simple moving average (20MA) (red line) has recently crossed above the 50-day simple moving average (50MA) (green line). This is a suggestion that the short to medium trend is once again aligned with the longer-term uptrend. The long-term trend is gauged by the price trading firmly above the 200-day simple moving average (200MA) (blue line).

The 20MA trading above the 50MA which in turn trades above the 200MA is what is considered proper order in technical analysis confirming that the short-, medium- and long-term trends are aligned.

The stochastic does however trade in overbought territory. This is a suggestion that perhaps the EUR/USD’s short-term gains have become overheated, although this signal is considered to carry less precedence than the underlying trend bias. Also, counter trend indications from oscillators such as the stochastic are considered less reliable than signals aligned with the trend.

EUR/USD - Price analysis

14APReurusdprice.pngSource: IG

The EUR/USD has now broken through resistance at the 1.1035 level. The upside breakout sees little in the way of resistance until the high at 1.1180. This in turn becomes the upside target favoured from the breakout. Traders who find long entry into the initial breakout might consider using a close below the 1.0965 level as a stop loss indication for the trade.

While the initial breakout is valid, our preferred approach to finding long entry is to look for the first pullback from each new high. This approach does find further favour from the fact that the price trades in overbought territory currently. Should a pullback occur, we would look for the price to find support at either the 1.0965 level or at the dotted black trend line on our chart before entering new long positions on the index.

EUR/USD – IG client sentiment

14APReurusdsentiment.pngSource: IG

As of the morning of the 14th of April 2023, the majority (70%) of IG clients with open positions on the EUR/USD expect the price to fall in the near term, while 30% of IG clients with open positions on the index expect the price to rise in the short term.

In summary

  • The short medium- and long-term trends (as gauged by the moving averages) are considered up
  • The EUR/USD is however also looking overbought at current levels
  • The trend bias is considered to take precedence over the overbought signal
  • The EUR/USD break of resistance suggests 1.1180 as a possible target
  • Most IG clients with open positions expect the price to fall in the near term
Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • XRP's price surged past the $0.5450 barrier, but it's now reversing gains and might remain above the 100-hour SMA.   Currently, XRP stock price is above $0.5250 and the 100-hour SMA.   The hourly XRP/USD chart indicates a bullish trend line with support at $0.5330.   After correcting gains, the pair might rise again unless it closes below the 100-hour SMA.   XRP Holding Strong   XRP, similar to Bitcoin and Ethereum, stayed bullish after surpassing $0.520. It broke through $0.5320 and $0.5450 resistance levels, reaching a weekly high of $0.5571 before starting to correct. The price dipped below $0.5450 and the 23.6% Fib retracement level from $0.5065 low to $0.5571 high.   Despite this, it's still above $0.530 and the 100-hour SMA. The hourly XRP/USD chart shows a bullish trend line with support around $0.5330.   Immediate resistance is around $0.5380, with the initial resistance near $0.5450. A close above $0.5450 might boost prices towards the next resistance at $0.5570. Bulls could push the price over this barrier and above $0.5650, with further advances potentially leading to $0.5720.   If XRP fails to clear the $0.5450 barrier, it may continue to decline. The trend line and $0.5330 provide initial downward support, aligning with the 50% Fib retracement level from $0.5065 low to $0.5571 high.   The next significant support is at $0.5250, with main support around $0.5185. A break and close below $0.5185 might accelerate the downward trend, potentially dropping to $0.5065 soon.   Technical Indicators   Hourly MACD: The bullish MACD for XRP/USD is losing momentum.   Hourly RSI: The RSI for XRP/USD is below 50.   Key Support Levels: $0.5330, $0.5185.   Key Resistance Levels: $0.5450, $0.5570.    
    • Silver Elliott Wave Analysis  Function -Trend Mode - Trend Structure - Impulse for blue wave A Position - Wave 5 of (5) Direction - Wave 5 of (5) in play Details -Wave 5 of (5) extends higher. There appears to be room for more before prices start turning down for a retracement. Same interpretation as the previous update. Silver has moved sideways for nearly 72 hours amid a strong year-long bullish trend. The price is more likely to break to the upside to continue this trend. However, if it breaks to the downside, buyers are expected to push the price up again shortly thereafter. Nevertheless, a significant pullback lasting several weeks is anticipated at some point. The question is: how much higher can the metal go before this pullback?   On the daily chart, the price extends the bullish sequence that began at 11.645 in March 2020. This sequence could either complete a double zigzag with a 100% target at 37 and potentially extend further to 48.3. If 48.3 is breached, the likelihood that the sequence will turn into an impulse wave increases. Whether it becomes an impulse or remains a corrective sequence is not crucial at this point since both scenarios project further rallies, with the impulse wave having a higher target. Currently, attention should be on the impulse sequence that started in January 2024, which is expected to complete blue wave A of the primary degree or blue wave 1 of an impulse. The impulse is close to completing its 5th wave—wave 5—after which a pullback is expected. The H4 chart shows the progress of wave (5) of the impulse and how much further it could go before the pullback begins. The price is currently in wave 3 of (5). Wave 3 appears to be incomplete, with the current triangle serving as the 4th sub-wave of wave 3, i.e., blue wave iv. Traders can expect the triangle to break to the upside to complete wave 3, followed by a minor pullback for wave 4 and further advances for wave 5. At the end of wave 5, we can expect a peak and a downward turn for primary degree wave B (in blue on the daily chart), which could last for several weeks. Technical Analyst : Sanmi Adeagbo Source : Tradinglounge.com get trial here!  
    • SPOT Elliott Wave Analysis Trading Lounge Daily Chart, Spotify Technology S.A., (SPOT) Daily Chart SPOT Elliott Wave Technical Analysis FUNCTION: Trend MODE: Impulsive STRUCTURE: Motive POSITION: Minor 5. DIRECTION: Upside in Minor 5   DETAILS: Looking for start moving higher after trading around TL3 at 300$. Looking for further upside towards at least the end of MG2 at 330$.   SPOT Elliott Wave Analysis Trading Lounge 4Hr Chart, Spotify Technology S.A., (SPOT) 4Hr Chart SPOT Elliott Wave Technical Analysis FUNCTION: Trend MODE: Impulsive STRUCTURE: Motive POSITION: Minor 5. DIRECTION: Upside in Minor 5   DETAILS: Looking for a triangle in 4 to be completed. There is a possibility we just completed wave {iv} and not 4, as equality of  Minor 3 vs. 1 stands at 340$.     Welcome to our latest Elliott Wave analysis for Spotify Technology S.A. (SPOT). In this report, we provide a detailed examination of SPOT's price movements and future projections using the Elliott Wave Theory. This analysis will cover both the daily and 4-hour charts, offering insights into the current trends and potential trading opportunities. Whether you are a seasoned trader or a market enthusiast, this analysis aims to enhance your understanding of SPOT's market behavior.   * SPOT Elliott Wave Technical Analysis – Daily Chart* In our latest Elliott Wave analysis of Spotify Technology S.A. (SPOT), we observe a bullish trend with an impulsive structure. Currently positioned at Minor wave 5, SPOT is gearing up for an upside move in Minor 5. After trading around Trading Level 3 (TL3) at $300, we anticipate further upside towards at least the end of Major Group 2 (MG2) at $330. Traders should be prepared for a potential continuation of the upward trend as the market gains momentum.   * SPOT Elliott Wave Technical Analysis – 4Hr Chart* On the 4-hour chart, SPOT is also exhibiting an impulsive mode within a motive structure, specifically positioned in Minor wave 5. We are looking for the completion of a triangle in wave 4. However, there is a possibility that we have just completed wave {iv} instead of 4, with the equality of Minor wave 3 vs. 1 standing at $340. This scenario suggests further upside potential as SPOT continues to move higher in wave 5.   Technical Analyst : Alessio Barretta Source : Tradinglounge.com get trial here!  
×
×
  • Create New...
us