Euro-Dollar Stagnates Near 200-Day Moving Average Amid Comments on Rate Cuts【January 31, 2024】

Fundamental Analysis

• Eurozone and Germany Avoid Recession, Minor Movements in Euro-Dollar
• Successive Comments on Rate Cuts by ECB Officials
• US FOMC Meeting Scheduled for Early Tomorrow, Potential for Significant Market Fluctuations

EURUSD Technical Analysis

Analyzing the Euro-Dollar daily chart. The Euro-Dollar attempted to break out of the 200-day moving average but failed. Yesterday’s GDP data showed that both Germany and the Eurozone avoided a recession, slightly strengthening the Euro-Dollar buying. However, with successive rate cut statements from ECB officials, the Euro-Dollar remains difficult to buy.

The 200-day moving average is flat, indicating no clear direction. The direction of the Euro-Dollar could be decided depending on what happens to the dollar at tomorrow’s early FOMC meeting. Eventually, it might try to break out of the 200-day moving average again when it surpasses the Ichimoku cloud.

Day Trading Strategy (1-Hour Chart)

Analyzing the Euro-Dollar chart on an hourly basis. Drawing a downtrend line shows it reacting at least three times. Currently, the lows are rising slightly, and the trend is upward. The RSI is at 53, indicating a slight upward trend. However, there’s no aggressive rise. With the FOMC, the biggest event ahead, volatility is decreasing.

Pay attention to whether it will fall again at the downtrend line and 200-day moving average. Today, aggressive trading might be challenging due to the upcoming FOMC. Scalping might offer opportunities for contrarian selling.

Support and Resistance Lines

Upcoming significant support and resistance lines:

USD 1.0860 – Weekly resistance line
USD 1.0836 – Pivot point

Market Sentiment

EURUSD Sell: 48%, Buy: 52%

Today’s Important Economic Indicators

*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.