Hot forecast for EUR/USD on April 16, 2024
April 16, 2024 8:22 amVideo
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Not only has the apparent divergence in the future actions of the European Central Bank and the Federal Reserve literally set the euro on a path towards parity with the dollar, but now the economic reports are also mounting pressure on the single currency. And this is despite the fact that industrial production in the eurozone seems to be improving. However, first of all, it is still contracting. And secondly, the slowdown in the pace of decline is slower than expected. It was expected to slow from -6.7% to -4.2%, but in reality, it slowed from -6.6% to -6.4%. So even if the previous results were revised, this still doesn’t inspire much optimism. Whereas in the United States, the situation is exactly the opposite. The pace of retail sales growth accelerated from 2.1% to 4.0%, which was expected to grow from 1.5% to 2.5%. So, in general, the macroeconomic dynamics clearly works in favor of the dollar.
And we will likely see the same situation today. Industrial production in the United States, which is currently declining by -0.2%, may rise 0.6%. In other words, the decline will be replaced by growth. This will also weigh on the single currency.
Despite clear signs of oversold conditions, the euro continued to depreciate. As a result, the quote touched the level of 1.0600, indicating a prevailing bearish sentiment among speculators.
On the 4-hour chart, the RSI is hovering in the oversold zone, which suggests that the instrument may be due for a price correction.
On the same chart, the Alligator’s MAs are headed downwards, corresponding to the direction of the downward cycle.
Outlook
In order to increase the volume of short positions despite signs of oversold conditions, the price must settle below the level of 1.0600. In this case, the quote could move towards the 2023 local low. Otherwise, the area around the 1.0600 level may act as support, leading to a rebound.
In terms of complex indicator analysis, indicators point to a downward cycle in the short-term and intraday periods.
The material has been provided by InstaForex Company – www.instaforex.com
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