We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Bullish
USD/JPY
Bullish
Gold
Mixed
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Bullish
More View more
Real Time News
  • RT @vtchakarova: British PM Johnson says won't negotiate further Brexit delay with EU. The EU also made it very clear (see Juncker’s recent…
  • How will the Trump impeachment process affect #forex and US stocks? Find out from Rupert Osborne, @IG_US, only on Trading Global Markets #podcast. Missed the episode? Read up here: https://t.co/1Bgo0Fl5CV https://t.co/BRNvqHVjYY
  • RT @bbclaurak: I'm told that's the advice from Cabinet Secretary - legal default is still leaving at end of this month, because they can't…
  • RT @bbclaurak: No 10 claims chances of no deal go up if Letwin passes - 'the govt will step up no deal preparations immediately as the risk…
  • RT @NSoames: I shall vote against The Letwin amendment and for the Deal
  • RT @Robert___Harris: On the eve of tomorrow’s rushed Commons vote I keep thinking of the journalist Phillip Knightley’s memo to the executi…
  • The $AUD has wilted as markets price in further rate cuts even as the OCR hovers at just 1%. Those cuts may come, but labor market strength may have to wane first. Get your market update from @DavidCottleFX here: https://t.co/h1Uvm8ogXh https://t.co/M1IP0jqh41
  • The inside bar pattern occurs regularly within the financial markets. Incorporating the inside bar strategy within a trading system can enhance a trader’s market analysis technique. Find out how you can use it from @WVenketas here: https://t.co/E3EWOYTYNw https://t.co/ZCT4pwc6nv
  • Greed has proven to be a hindrance more than assistance for traders. How does greed impact your trading? Find out from @RichardSnowFX here: https://t.co/aT8TZjlFqP https://t.co/C4vrTm69sE
  • Central bank independence has several advantages and disadvantages. Find out what they are in-depth with @MartinSEssex here: https://t.co/wVFXbbTxf1 https://t.co/WkwZK6wtzy
EURUSD Price Breaks Down as US Dollar Rides Roughshod

EURUSD Price Breaks Down as US Dollar Rides Roughshod

2019-04-25 08:35:00
Nick Cawley, Analyst
Share:

EURUSD Price, Chart and Analysis:

  • EURUSD touches at 22-month low of 1.1141.
  • EURUSD looks oversold, US dollar looks overbought.

Q2 2019 EUR Forecast and USD Top Trading Opportunities

EURUSD finally broke down late yesterday and touched a fresh 22-month low as US dollar strength took out noted EURUSD support levels. The US dollar continues to attract flows with the yield differential between 2-year US Treasuries (2.32%) and German Bunds (-0.60%) supportive of the greenback. The break lower had been expected over the last few weeks with official data pointing to a sharp economic slowdown in Germany and the Euro-Zone.

Euro Fundamental Outlook: EURUSD Crumbles on Euro-Zone Growth Fears

The US dollar is at, or close to, highs last seen nearly two years. The strength of the USD - the cleanest shirt in the laundry basket – comes despite a growing realization that the next move in US interest rates is likely lower. Central banks around the globe have been adopting a more dovish stance over the last few months as economies weaken and inflation stays stubbornly below target.

The US dollar chart is showing signs that the recent bull surge is overdone with the CCI indicator showing the greenback at extreme overbought levels in the short-term. The overall set-up however remains positive with a cluster of higher lows and higher highs seen since the start of the year.

US Dollar Basket (DXY) Daily Price Chart (June 2018 – April 25, 2019)

EURUSD Price Breaks Down as US Dollar Rides Roughshod

EURUSD is currently trading around 1.1140, the lowest level seen since late-June 2017. The next support zone is between 1.1020 and 1.1070 from mid-May 2017. The pair looks oversold in the short-term, using the CCI indicator. Coming up, two important US releases with durable goods orders later today and the first look at US Q1 GDP on Friday. Both releases have the ability to steer the US dollar in the short-term.

EURUSD Daily Price Chart (May 2018 – April 25, 2019)

EURUSD Price Breaks Down as US Dollar Rides Roughshod

Retail traders are 70.0% net-long EURUSD according to the latest IG Client Sentiment Data, a bearish contrarian indicator. However recent daily and weekly positional changes give us a stronger bearish contrarian bias.

We run several Trader Sentiment Webinars every week explaining how to use IG client sentiment data and positioning when looking at a trade set-up. Access the DailyFX Webinar Calendar to get all the times and links for a wide range of webinars.

Traders may be interested in two of our trading guides – Traits of Successful Traders and Top Trading Lessons – while technical analysts are likely to be interested in our latest Elliott Wave Guide.

What is your view on EURUSD – bullish or bearish? You can let us know via the form at the end of this piece or you can contact the author at nicholas.cawley@ig.comor via Twitter @nickcawley1.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.