The EUR/USD pair edged higher and headed into last weekend trading at around 1.0050, recovering from 0.9863 – a level last seen in December 2002. The American currency remained strong throughout the first half of last week. It started changing course on Wednesday, to finally giving up on Thursday as a result of central banks’ noise. In this article, we’ll detail EUR/USD Weekly Technical Forecast for Week 37, 2022.
EUR/USD technical outlook
The EUR/USD pair hit a three-week high of 1.0112 ahead of the close, retreating from the level as dollar buyers are not ready to give up. The weekly chart shows that technical indicators are barely recovering from oversold readings, as the pair develops roughly 300 pips below a firmly bearish 20 SMA. The longer moving averages maintain their downward slopes but are too far away to be technically relevant. At this point, the modest bounce from record lows is barely seen as corrective and not enough to confirm an interim bottom.
Technical readings in the daily chart support a possible bullish extension. The pair is above its 20 SMA for the first time since mid-August, although the moving average maintains its bearish slope. Technical indicators head firmly north, with the Momentum well into positive levels but the RSI at around its midline. Finally, the longer moving averages keep heading south far above the current level, limiting the chances of a trend change.
Bulls may need to push the pair above the 1.0220 price zone to become more confident. A daily descending trend line coming from this year’s high at 1.1494 falls around the level, providing strong static resistance. Once above the area, the next relevant resistance is the 1.0340 price zone.
Support could be found at 0.9990, 0.9920 and the 0.9860 price zone. Should the pair break below the latter, the long-term bearish trend will likely pick up pace, with the next relevant target at 0.9700.
EUR/USD sentiment poll
According to the our poll, the EUR/USD pair is seen averaging parity for the next three months. Although the poll offers some interesting takeaways. The first one is that bears dominate the three time frames under study, accounting for over 50% in all cases. Bulls, on the other hand, are down to 24% in a one-month view, suggesting sellers are still holding the grip.
The Overview chart shows that the near-term moving average remains directionless, as the spread of potential targets is well-limited around the current level. The monthly moving average turned lower as most targets accumulate below parity. Some wild cards though, have appeared with bets up to 1.12. However, the quarterly view offers once again a bearish moving average and most targets below the current level, while none above 1.10. Pretty much, a corrective advance seems likely in the upcoming weeks, although the long-term perspective is still bearish.
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