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EUR/USD: Weekly Forecast 16th – 22th October – 16 October 2022

The price of the EUR/USD currency pair is actually well within its average value when a five day technical chart is looked at, and a trader could scratch their head and think nothing of it.


The EUR/USD produced a fairly consolidated price action path at the start of last week, but on Thursday and Friday demonstrated dangerous velocity as it spiked in both directions.

The EUR/USD will enter this coming week of trading near the 0.97185 mark. The price of the EUR/USD currency pair is actually well within its average value when a five day technical chart is looked at, and a trader could scratch their head and think nothing of it.

However, two important things did happen in last week’s trading. First, the high for the EUR/USD occurred on Thursday and Friday before going into the weekend around the 0.98050 mark, but this height was below the previous week’s results when a high of nearly 1.00000 was produced on the 4th of October. The other important consideration is that whipsaw price action took place the last two days of this past week.

Technical and Fundamental Winds are combining in the EUR/USD and it is Dangerous

Speculators need to monitor the EUR/USD carefully. Global market conditions remain fragile and behavioral sentiment has shown definite signs of volatility, which should be expected to remain factors in this coming week. The inability of the EUR/USD to not even come close to the 0.99000 level is rather intriguing. Incrementally from a technical perspective the EUR/USD continues to suffer within a long-term bearish trend.

The European Central Bank will conduct a monetary policy meeting in the following week and its pronouncement will be the 27th of October. The ECB is expected to raise its interest rate. However there are loud noises within the European Union that banks and corporations are having problems with the slightest of interest rate hikes. While the ECB is expected to raise its key borrowing rate by another 0.75%, it wouldn’t be surprising if they tried to sound almost ‘dovish’ if in fact they take this monetary policy path.

Technical traders should watch the 0.97000 level, if it is proven vulnerable and is not able to reignite values above it could signal additional selling.The spike lower on Thursday which was then followed by a burst upwards, shows the EUR/USD like the entire Forex market remains nervous and reactionary. Traders must use risk management.

Eyes Remain on the U.S Federal Reserve and it is Effecting the EUR/USD

The USD remains strong against most major currencies. While traders may believe the EUR/USD is vastly oversold, technically the currency pair continues to display a solid lower price range which actually shows resistance has been hard to penetrate.

EUR/USD Weekly Outlook:

Speculative price range for EUR/USD is 0.95100 to 0.99300

Solid risk management is advised for all Forex traders. The EUR/USD is producing quick results and its sudden plunge lower on Thursday of last week serves as a reminder. Stop loss and take profit orders should be used by retail traders and a conservative amount of leverage is encouraged. Forex, including the EUR/USD has been producing violent price action which some traders may not be used to. If the 0.97100 level begins to be flirted with and the 0.97000 is penetrated lower, traders should remember the 0.96700 realms were traded with sustained action last week.

It is unlikely the EUR/USD is suddenly going to develop a strong higher price range this coming week. Certainly it can trade higher, but the inability of the EUR/USD to even topple the 0.99000 realm is a bearish indicator and shows nervous sentiment abounds in the marketplace as the USD stays strong. The U.S Federal Reserve is definitely going to hike borrowing costs again in November. Inflation remains troubling in the U.S and Europe.

If the EUR/USD can climb above the 0.97800 mark and sustain this action, the potential to trade up to 0.98300 to 0.98500 could attract bullish speculators. Short term considerations should be given importance and traders should not be overly ambitious. Realistic targets may produce solid results for traders using good risk taking tactics. A EUR/USD trading above the 0.99000 may not look distant, but it has proven difficult to surpass the past ten days.

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