2023-01-23 18:44

EURUSD Analysis

Technical, fundamental, and sentimental analysis of EURUSD in Forex
EURUSD Analysis EURUSD Analysis

A review of the EURUSD movements

With the dollar strength, the EURUSD currency pair had downward movements for most of 2022 and reached below 1. And it started to improve after a long descending path in the last two months of 2022, with the dollar weakness due to the US Federal Reserve's aggressive policy reduction and the economic situation improvement in Europe. This was a general review of the EUR-USD situation, further, we will discuss the exact status of this currency pair in the daily timeframe.

EURUSD technical analysis

By analyzing the EURUSD symbol's daily time frame, we can see that the  EURUSD is involved in the 1.08570 to 1.09000 resistance level. If we pay attention to the past price, we can see that the price has gained more descending power by penetrating below this level and the downward trend continues, even if the price is close to this level, it has been accompanied by price rejection.
Another reason that will increase the importance of this level from a technical pov is the resistance level's interference with the 50% Fibonacci long-term downward wave of the EURUSD.

The RSI indicator can also show the weakness in the movement continuation and price divergence in the daily timeframe.

Therefore, in the daily timeframe, we can expect a descending price reaction in this range. But to turn the price descending reaction into a retracement, it is necessary to break the support levels and the daily trend line, which requires a review in the future.

From the candlestick pov, price reversal candles have formed in the daily timeframe.

However, if the price stabilizes above the mentioned resistance level, we can expect further EURUSD growth to the approximate 1.11 resistance level.

EURUSD fundamental analysis

By reviewing the eurozone fundamental news, one can witness  Europe's strong economic growth. On the other hand, economic growth with disinflation can allow the European Central Bank to reduce the speed of interest rate increase. If this is how market participants perceive the fundamental data, we can expect the euro to decline in value. However, we should pay attention to the eurozone inflation because if the inflation is decreasing, we can see the euro's weakness.

On the other hand, the depreciation of the USD, which started a long time ago and continues to this day, seems to be a good opportunity for retracement, profit settlement, and strengthening of the dollar.

EURUSD sentiment analysis

According to the technical analysis that the price is at an important daily resistance level, seems like we can expect a descending price reaction. And in lower timeframes, one should look for a sell position according to one's strategy.

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