EUR/USD Daily Forecast – Test Of Resistance At 1.1325

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Euro Tries To Move Higher Against U.S. Dollar

EUR/USD is currently trying to settle above the resistance at 1.1325 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is currently trying to settle below the support level at 95.75. In case this attempt is successful, the U.S. Dollar Index will gain additional downside momentum and head towards the support at 95.40 which will be bullish for EUR/USD.

Yesterday, EU reported that Euro Area Inflation Rate increased by 0.8% month-over-month in October, in line with the analyst consensus. On a year-over-year basis, Euro Area Inflation Rate grew by 4.1%. Euro Area Core Inflation Rate grew by 2% year-over-year compared to analyst consensus of 2.1%.

Inflation in the Euro Area is weaker compared to the inflation in the U.S., and ECB is expected to remain dovish while the Fed could be forced to raise rates several times in 2022. In this light, it remains to be seen whether euro will be able to gain more ground against U.S. dollar on the foreign exchange market.

Technical Analysis

EUR/USD managed to settle above the resistance level at 1.1300 and is trying to settle above the next resistance at 1.1325. RSI remains in the oversold territory, and there is plenty of room to gain upside momentum in case the right catalysts emerge.

In case EUR/USD settles above the resistance at 1.1325, it will move towards the next resistance level which is located at 1.1350.

A successful test of the resistance at 1.1350 will open the way to the test of the resistance at 1.1370. In case EUR/USD manages to settle above this level, it will head towards the resistance at 1.1400.

On the support side, the nearest support level for EUR/USD is located at 1.1300. In case EUR/USD moves back below this level, it will head towards the support at 1.1270. A move below 1.1270 will push EUR/USD towards the next support at 1.1230.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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