EUR/USD: forecast for September 14-20
By Elizabeth Belugina
EUR/USD got support from the 100-day MA in the 1.11 zone and managed to creep up to the 1.13 area.
In the medium term, the euro area’s fundamentals look weak, and the European Central Bank’s focus on policy easing will keep the euro under pressure. In the short-term, however, one should be cautious with the euro shorts. Even if the US Federal Reserve rates rate in September, euro may hold its ground after the initial decline as the market’s risk sentiment will likely deteriorate supporting demand for the euro as a refuge currency.
Next week the focus will surely be on American economic releases. In the euro area, pay attention to German ZEW economic sentiment on Tuesday and the region’s current account data on Thursday. On Sunday, September 20, there will be parliamentary election in Greece. According to the latest polls, no political party is able to gain majority, so Greece will likely face the coalition government, which may be rather difficult to form. The event may create moderate negative risks for the euro.
Overall, we prepare for a volatile trading week. The main levels to watch on the downside are 1.1100, 1.1015 and 1.0950. On the upside, resistance is at 1.1330 and 1.1436/66.