At the start of the new month, the EUR/USD exchange rate was hovering around the 1.10 resistance level and it is unlikely to remain above this level unless the central bank's policy decisions provide the euro with a clearer interest rate advantage over the dollar. The price briefly reached 1.1035 before settling at 1.0982.

The future of the euro/dollar exchange rate is still optimistic, with some analysts predicting it to reach 1.1350 soon.

Technical analysis suggests that the bulls will remain in control if the price of the EUR/USD pair moves above the psychological resistance of 1.1000, with the next peaks at 1.1065 and 1.1120. However, the bears may move towards the support level of 1.0920 if the trend turns bearish.

For the EURUSD pair, in the long term, we can observe the formation of a correction wave IV inside a large impulse. Cycle correction IV, most likely, takes the form of a primary double zigzag. The actionary leg and the bearish corrective intervening wave are completed. The final actionary wave may be under development.

Like the previous primary waves, can take the form of an intermediate zigzag (A)-(B)- (C). The first impulse (A) and correction (B) in the form of a skewed triangle are fully completed. In the near future, we expect growth in the potential impulse (C) to 1.135. At that level, this impulse will be equal to wave (A).

An alternative scenario suggests that the primary wave is not a simple zigzag, but a double one. It is marked with sub-waves (W)-(X)-(Y).

The intermediate wave (W) looks like a completed triple zigzag. Currently, an intermediate wave (X) may be in the process of construction, which may take the form of a minor double zigzag W-X-Y.

In the near future, the price may go down to 1.080. At that level, wave (X) will be at 50% along the Fibonacci lines of wave (W).

EURUSD to auction surprising gains depending on fundamentals

May 09 2023

Stop Loss -0.70%

Holding time 1d6hr

1.09786

Entry price

1.09018

Stop loss price