EURO PRICE OUTLOOK: EUR/USD, EUR/GBP, EUR/CAD – WEEKLY TECHNICAL FORECAST
- Euro price action edged marginally higher on balance over the last five trading sessions
- EUR/USD climbed about 150-pips but forfeited more than half of those gains as volatility rises
- EUR/GBP and EUR/CAD extended their advance and show potential for bullish continuation
Euro price action was mixed and choppy this past week, but the bloc currency edged modestly higher against major FX peers on balance. The Euro jumped against the Canadian Dollar with spot EUR/CAD advancing nearly 0.9% from the prior Friday’s close. EUR/USD prices staged an impressive 180-pip rally to start the week, but the most liquid and heavily traded currency pair whipsawed lower to give back nearly all those gains. As for EUR/GBP, spot prices oscillated in a tight trading range for most of the week until Friday’s 75-pip advance propelled the Euro-Pound out of its consolidation pattern.
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EUR/USD PRICE CHART: DAILY TIME FRAME (19 FEB TO 26 JUN 2020)
EUR/USD strength has faded throughout the month as suggested by the negatively sloped relative strength index and 8-day exponential moving average. Also, indicated by the series of lower highs, spot EUR/USD has started to come under pressure as bullish momentum putters out and the US Dollar attempts to rebound.
| Change in | Longs | Shorts | OI |
| Daily | -4% | -5% | -4% |
| Weekly | 22% | -9% | 1% |
The Euro now looks toward technical support underpinned approximately by the 1.1200-price level for a possible area of confluence to bolster spot EUR/USD. A breakdown below this zone could lead to an acceleration in selling that steers EUR/USD price action toward the mid-point of its year-to-date trading range.
EUR/GBP PRICE CHART: DAILY TIME FRAME (07 FEB TO 26 JUN 2020)
Chart created by @RichDvorakFX with TradingView
EUR/GBP continues to climb within its bullish rising channel. The MACD illustrates upward momentum has gained pace recently as the Euro-Pound presses to fresh month-to-date highs. EUR/GBP prices finished the week on its front foot after leaping 0.75% off its short-term exponential moving average, which could provide technical support going forward. Eclipsing the 38.2% Fibonacci retracement might open up the door for Euro-Pound bulls to target the 0.9200-price level highlighted by the 23.6% Fib.
| Change in | Longs | Shorts | OI |
| Daily | -15% | 10% | 0% |
| Weekly | -11% | 11% | 2% |
EUR/CAD PRICE CHART: DAILY TIME FRAME (03 APR TO 26 JUN 2020)
Chart created by @RichDvorakFX with TradingView
The Canadian Dollar was the worst performing currency against the Euro last week with EUR/CAD price action extending its string of higher highs and bullish trend potentially under development. On that note, spot EUR/CAD shows topside breakout potential, which the expanding Bollinger Band might help facilitate, particularly as crude oil hits resistance.
— Written by Rich Dvorak, Analyst for DailyFX.com
Connect with @RichDvorakFX on Twitter for real-time market insight
