We have a busy week ahead of us with rate decisions from several central banks at once. The Fed plans to raise rates at a slower pace a week earlier as inflation eases. But the ECB and the Bank of England may raise their rates more than the Fed, which may have a negative impact on the US dollar. It is believed that the abnormally hot winter in Europe played a role in strengthening the EUR/USD pair and, in general, slowing down the upcoming problems in the eurozone. As for the UK, the economy is in the worst condition here, polls show that the risks of recession are increasing again, and mass strikes of workers only exacerbate the current situation in the country’s economy. But inflation in England is still high, so there is a chance that the Central Bank will raise the rate by 50 basis points, while participants estimate the increase by 25 basis points at only 30%.
EUR/USD Forecast January 30 — February 3, 2023
The Euro/Dollar currency pair EUR/USD completes the trading week near the area of 1.0885 and continues to move within the correction and the downward channel. Moving averages indicate a bearish trend. Prices have broken through the area between the signal lines up, which indicates pressure from buyers of the European currency and a likely continuation of growth already from current levels. At the moment, we should expect an attempt to develop the growth of quotes and test the resistance area near the level of 1.0925. Where is the expected rebound down and the continuation of the fall of the Euro Dollar. The potential target of the decline is the area below the level of 0.9675.
An additional signal in favor of a decrease in the EUR/USD currency pair on Forex will be a test of the trend line on the relative strength index (RSI). The second signal will be a rebound from the upper border of the descending channel. Cancellation of the option of falling quotes of the Euro/Dollar pair in the current trading week January 30 — February 3, 2023 will be a strong growth and a breakdown of the level of 1.1075. This will indicate a breakdown of the resistance area and continued growth of the pair to the area above the level of 1.1485. With a breakdown of the support area and closing of quotes below the level of 1.0605, which will indicate a breakdown of the lower border of the bullish correction channel.
Among the important news from America and Europe in the next trading week that may have an impact on the EUR/USD rate, it is worth highlighting: Federal Reserve System (Fed) Interest Rate Decision, Press conference Federal Open Market Committee (FOMC) Press Conference, European Central Bank (ECB) Interest Rate Decision, European Central Bank (ECB) Monetary Policy Press Conference, United States Nonfarm Payrolls.
EUR/USD Forecast January 30 — February 3, 2023 suggests an attempt to develop a correction and test the resistance area near the level of 1.0925. Where should we expect the pair to continue falling in the Forex market to the area below the level of 0.9675. An additional signal in favor of the decline will be a test of the resistance line on the relative strength index (RSI). Cancellation of the fall option for the Euro/Dollar will be a strong growth and a breakdown of the level of 1.1075. In this case, we should expect the pair to continue to rise with a potential target at the level of 1.1485.
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