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Hot forecast for EUR/USD on 27/07/2022

Relevance up to 15:00 UTC–4

Although the macroeconomic calendar was completely empty yesterday, as on Monday, the single European currency began to decline steadily from the very opening of the European trading session. This continued until the opening of the US trading session, after which the market froze in place. As a result, the single currency lost about 100 points. The only way to explain this is the confidence of market participants regarding the results of today’s meeting of the Federal Open Market Committee. The fact that the refinancing rate will be raised by 75 basis points today is a decided issue. What the US central bank will do next is much more important. The dollar will only strengthen if the Federal Reserve announces a similar hike during the September meeting. In other words, most investors suddenly believed that this is exactly what Fed Chairman Jerome Powell would say. Or, we are talking about a banal speculative attack, as a result of which, the euro will significantly rise immediately after the Fed meeting. So everything will depend on what exactly Powell says.

The EURUSD currency pair completed the movement within the horizontal channel at 1.0150/1.0270 by breaking its lower border. As a result, the quote came close to the level of 1.0100, where there was a rollback to the lower border of the previously completed flat.

The technical instrument RSI H4 crossed the 50 middle line from top to bottom, which indicates the end of the flat. RSI D1 has been ignoring the correction stage and flat all this time. The indicator is moving in the lower 30/50 area, which indicates a high interest of traders in the downward trend.

The MA moving lines on the Alligator H4 indicator have completed the weaving stage. The lines are pointing down, but as long as they are above the 1.0150 level, the risk of further interweaving remains.

Expectations and prospects

In this situation, there is speculative interest in the market, which leads to chaotic price jumps. In order for the sell signal for the euro to be confirmed, the quote needs to stay below 1.0100. In this case, market participants will head towards the parity level.

Otherwise, the breakdown of the 1.0150 border could be false, and the quote will return to the previous flat.

Comprehensive indicator analysis has a buy signal in the short term due to a rollback. Technical instruments in the intraday period point to selling, due to the breakdown of the level of 1.0150.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

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