Analysis Technical Analysis

EURO FX (6E) Futures Technical Analysis

  • Euro continues to weaken against the US Dollar
  • Gaussian Channel creating great short opportunities
  • The Euro could reach parity against the dollar

The Euro has weakened against the dollar since the beginning of 2021, with lower lows printed consecutively on the daily chart. Prices have retraced to the 50 Exponential Moving Average (EMA) countless times giving excellent short opportunities for bears.

As the currency continues to lose value, we could expect the Euro to reach parity and test the 1.0000 psychological level very soon, with only a 0.7% drop needed to break below that critical level.

daily chart Euro
Euro Daily Chart

Bearish Sentiment On the Hourly Chart

If we look at the shorter-term hourly time frame, the Euro has been consolidating for over a month, often finding support at the point of control line for the fixed range volume profile.

However, a key level can only be tested so many times before it eventually breaks, and we see that playing out today. As prices have no support until the critical level of 1.0000 is reached, it’s a high probability we will see the Dollar rally against the Euro, causing the bearish momentum to continue.

2 Hourly Euro Chart

There is no current indication that sentiment has changed. If there is adequate support at the 1.0000 price mark, it could be an opportunity to sell the bounce.