EUR/USD Forecast: Euro Continues to Be Somewhat Lackluster

• The market hasn't seemed to have much of a push lately, so the euro has continued to see a lot of sideways action overall.
• This shouldn't come as a major surprise, though, as rate cuts by both central banks are probably imminent for this year.

Euro Continues to Trade Near 1.09

As you can see, the euro has been circling the 1.09 mark, which has been significant on several occasions. It remains to be seen, though, if we can break above that. It does create the chance that we could move to the 1.10 level if we can. There is a bigger consolidation area underneath that. Additionally, I believe that the 1.07 level provides a lot of support underneath. Support is provided by both the 200-day and the 50-day EMAs below. Given everything else being equal, I believe there will be a lot of noisy behavior in this market, and it makes reasonable for this to be the case.

Top Forex Brokers

1

Get Started 74% of retail CFD accounts lose money Read Review

Ultimately, it is likely that the Federal Reserve will lower interest rates later this year, and it may be necessary for the European Central Bank to follow suit. Honestly, they probably have to do the same thing because the German economy has somewhat declined. This is a situation where the economy is negatively impacted enough that action must be taken. I believe you have a fairly busy year ahead of you, and it does make some sense that we just float aimlessly. This pattern of general consolidation is where we are at. It is therefore possible to argue that we are either close to or at fair value. Additionally, bear in mind that the US dollar will undoubtedly be greatly impacted by Friday's non-farm payroll announcement. This could changes things, but I am not holding my breath to be honest. I think we are essentially near “fair value” and that’s the most important thing.

Therefore, as of right now, my feelings about this pair are rather neutral. It really shouldn't come as too much of a surprise as there are currently quite a few very neutral FX pairs. As a result, I don't think we'll be seeing any major news anytime soon, and if you're going to trade this pair or any other major currency pair, you should probably concentrate on shorter-term charts.

Ready to trade our daily Forex forecast? Here’s a list of some of the top forex brokers in Europe to check out.