#EURUSD Analysis: #Euro Under Pressure,Eyes on #ISM Data (24 Jan 2024)

Technical indicators may shift towards strong oversold levels if the EUR/USD price moves towards support levels at 1.0800, 1.0745, and 1.0690 successively

• The (EUR/USD) pair traded under selling pressure, extending losses to the support level of 1.0821 after bulls failed to achieve more than the resistance level of 1.0916.
• Recently, the US dollar remains strong on expectations of the Federal Reserve's monetary policy tightening in the new year, as well as investors' preference for the dollar as a safe haven amid rising global geopolitical tensions.

Will the Euro Rise Today?

Readings of the purchasing managers' index (PMI) for the manufacturing and services sectors of the eurozone economies will have a strong impact on investor sentiment towards the future of the bloc's economic recovery, as well as what the European Central Bank (ECB) will announce later this week. Moreover, the reaction to the data and the event will shape the picture and future of the euro price in one direction.

On the other hand, US stocks have been largely immune to the Federal Reserve's warnings that a US rate cut is a long shot. Instead, investors have cheered the resilience of the US economy even after the most aggressive policy tightening cycle in decades. However, some corners of Wall Street have begun to question whether the rally will continue as US swap traders have reined in bets on a rate cut in March.

US stocks have soared to record highs, with the S&P 500 returning to its all-time high last week for the first time in two years. Obviously, much of this is due to expectations that the Federal Reserve will cut rates several times this year after raising them sharply in the past two years. Moreover, such cuts could lead to higher investment prices while easing pressure on the economy and the financial system. Furthermore, the Federal Reserve itself has said that it could cut rates three times this year as inflation cools, which would allow the central bank to ease its constraints on the economy.

EUR/USD Technical Analysis and Forecast:

Based on the performance on the daily chart, the overall trend for the EUR/USD pair is bearish. As mentioned before, remaining below the support level at 1.0880 reinforces the strength and dominance of bears in the trend. A strong downward movement is imminent if today's data results support expectations of economic recession in the Eurozone. Moreover, technical indicators may shift towards strong oversold levels if the EUR/USD price moves towards support levels at 1.0800, 1.0745, and 1.0690 successively. Conversely, there won't be an opportunity for an upward rebound without moving above the psychological resistance at 1.1000 again.

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