No one is 100% sure whether the EUR will go up or down: today, tomorrow, or next week. However, applying fundamental analysis, technical analysis, trader positioning analysis, and other forecasting methods allows you to form your own opinion about the direction in which the EUR exchange rate is most likely to move: up or down. According to TU technical analysis signals recommendation for EUR/USD on the 1D timeframe is Strong sell.
The EUR/USD pair is the most traded pair in the Forex market, with a turnover of over USD 7 trillion per day. It's no wonder that millions of traders worldwide want to know how the EUR price will change today and whether the euro will appreciate or depreciate. The answer to this question cannot be known for certain, but by applying various methodologies described in this article, you can gain valuable insights into how to forecast changes in the EUR price: today, tomorrow, or in the short term.
Why is EUR stronger than USD?
The EUR currency was launched on January 1, 1999. Its exchange rate is determined by the balance of supply and demand forces. Therefore, most of the time, EUR 1 is worth more than $1.
Why is EUR/USD easy to trade?
Trading EUR/USD is not an easy way to earn profit. However, it is considered that the EUR/USD pair may be suitable for beginners due to narrow spreads and great availability of news and analytical information online.
How do I start trading currency?
Open and fund an account with a broker, install a trading platform on your computer or phone, and you are ready to go. Starting to trade currencies these days is quite simple, and you can begin with as little as EUR 100 in initial capital.
What’s the best time to trade EUR/USD?
The answer to this question depends on the trader's personal preferences and the strategies they employ. It is considered that the best time to trade is when volatility is above average. For EUR/USD, this is usually from 6:00-7:00 UTC to 15:00-16:00 UTC.
Traders Union prepares a medium-term forecast for the EUR/USD price for up to 30 days based on indicators.
NOTE!
Signals may differ on different timeframes. If you want to hold the EUR/USD for longer than 1 week/1 month, it is best to use the signals on daily and weekly timeframes. Timeframes from 5 minutes to 1 hour are best suitable for short-term transactions.
Best Broker Recommended for Trading EUR/USD
Suitable for those who want to earn a profit from price fluctuations.
Best Broker Recommended for Holding EUR/USD
Suitable for those who want to invest for the long term.
To find a better entry point, also find out what TradingView technical analysis tool signals for the Euro to US Dollar currency exchange rate. "Sell" or "Strong Sell" means that most of the signals are bearish. "Buy" or "Strong Buy" means that most of the signals are bullish. For short-term signals, it is recommended to use settings from 15 minutes to 2 hours. For long-term signals, it is recommended to use settings from 4 hours to 1 week.
The reasons for the fluctuation of the euro’s value up and down lie in the imbalances of supply and demand, which arise from various drivers. These drivers may have different natures, and to form your forecast regarding the rise or fall of the EUR, you need to try and consider as many of them as possible. The most important ones are described below.
Fundamental drivers of the EUR price change may be:
Scheduled events;
Unscheduled events.
Typically, these are releases of economic news, press conferences of governors of central bank, etc. Such events, including the timing of their release, as well as the degree of their influence on the EUR exchange rate, can be found in special economic calendars. Being aware of upcoming events and expectations associated with them is extremely important for forecasting the EUR exchange rate for the coming days.
You can familiarize yourself with upcoming events here: Forex Economic Calendar.
The most important events that affect the direction of the EUR price movement – up or down – are:
News from the ECB. Decisions on changes in interest rates, press conferences by the ECB President and other top officials regarding monetary policy – such events occur practically every month.
Inflation news. The most significant for market participants in the Eurozone are the publications of German Prelim CPI values.
Publication of PMI values. Purchasing Managers' Index for France and Germany (+ ZEW Economic Sentiment Index) is published at the end of each month and has a noticeable impact on the rise or fall of the EUR.
Basic dollar statistics - CPI, PPI, GDP, NFP, Industrial production, retail sales.
Other scheduled events. Publication of GDP values, election results, labor market news, financial forums.
Force majeure - emergencies, natural disasters, man-made disasters, terrorist attacks, epidemics.internal political instability (as an example - Brexit).
Usually, if the news forecasts are far from the facts, this leads to stronger volatility spikes; the EUR may depreciate or appreciate very strongly – both in the first minutes after the event and during the trading session, or even several.
These include natural disasters, terrorist attacks, military actions, unexpected statements by politicians and other influential figures, various crises. The economic calendar does not include all events that can cause the EUR to rise or fall.
A vivid example is the events of spring 2020.
Weekly EUR/USD chart
Coronavirus-related panic had a strong impact on the EUR exchange rate: following a volatility spike, the trend reversed from bearish to bullish.
This example highlights the importance of traders staying informed about various events that can impact the currency market. If there are no important fundamental drivers on the agenda, it increases the chances that the value of the EUR will not change significantly.
Volatility of EUR/USD by days of the week
The average change of the EUR price against the USD is 0.67% per day. According to statistics, the probability of the EUR price increasing or decreasing is:
Highest on Thursday. On this day, important news is most often published;
Lowest on Monday. This is partly due to the fact that Mondays often coincide with additional days off.
Technical analysis drivers include:
Support and resistance levels. The EUR price may bounce (reversal). Or break out, potentially starting a significant trend;
Trend lines and channels. They are applicable to any timeframe. When building trend channels, pay attention to its median line, which helps to construct the channel more accurately;
Chart patterns. An important formation is the triangle, which can have various configurations, as a triangle usually indicates consolidation, and a triangle breakout is a potential signal of a new trend;
Indicator patterns. Usually, using only well-known indicators, such as RSI, MACD, Moving Averages, and others, cannot provide a competitive advantage. But they can be used as a component of a trading system, for example, for entering a trade or managing a stop-loss;
Candlestick patterns. Examples can be found here: 20 Best Candlestick Patterns To Learn
Other patterns. For example, from volume analysis. Or from the Elliott Wave Theory.
The chart below shows how effectively technical analysis tools can be used in forecasting the EUR exchange rate.
EUR/USD Chart
Suppose we are at the end of the day indicated by the arrow. How can we understand what will happen next? Will the EUR rise or fall? To do this, pay attention to the price action, namely:
The price reacted in the past to the level of 1.07250;
The price attempted a bearish breakout;
However, after the attempt at a bearish breakout, 2 bullish candles formed, with the second one much larger. This means that bulls are strengthening their dominance.
Therefore, the main assumption about the price action in the coming days should be a forecast with the strengthening of the EUR above the level of 1.07250.
To increase the probability of success of your forecasts on the price of the euro in the short and long term, combine fundamental and technical analysis.
Your forecasts may become more accurate if you follow these tips:
Pay attention to the positions of other traders regarding the EUR.
Such data can be found on various resources, here is an example:
Traders' positions
Interpreting this information is an interesting task. For example, as shown in the screenshot, there is a bearish forecast for the EUR/GBP pair. However, 75% of traders are holding long positions. Why is that?
This is an against the market crowd trading tactic. It is based on the fact that the majority of Forex traders fail. That is, by analyzing such imbalances in traders' sentiments, you can make a forecast that the EUR may depreciate in the coming days relative to the British pound.
Use EXY
Open the TradingView chart and enter the EXY ticker. This is the EUR index relative to other currencies.
EXY — the EUR index relative to other currencies
This tool allows for a more balanced analysis of trends affecting the euro, while analyzing EUR/USD to identify the EUR trend may be subject to excessive distortion from the USD.
Take advantage of your broker's benefits
Narrower spreads, lower fees, faster order execution without slippage — these and other advantages can make your EUR trading more profitable. For more details, see the article titled Best Forex Brokers To Trade EUR/USD With Tight Spreads.
The price of the EUR in the coming days will depend on various economic indicators, geopolitical events, and the behavior of the majority of market participants. Changes in the ratio of bullish and bearish drivers can create imbalances in supply and demand, leading to trending periods in the market. When assessing the situation, consider the maximum available information and avoid excessive risk when making trading decisions.
A broker is a legal entity or individual that performs as an intermediary when making trades in the financial markets. Private investors cannot trade without a broker, since only brokers can execute trades on the exchanges.
Trading involves the act of buying and selling financial assets like stocks, currencies, or commodities with the intention of profiting from market price fluctuations. Traders employ various strategies, analysis techniques, and risk management practices to make informed decisions and optimize their chances of success in the financial markets.
Volatility refers to the degree of variation or fluctuation in the price or value of a financial asset, such as stocks, bonds, or cryptocurrencies, over a period of time. Higher volatility indicates that an asset's price is experiencing more significant and rapid price swings, while lower volatility suggests relatively stable and gradual price movements.
Index in trading is the measure of the performance of a group of stocks, which can include the assets and securities in it.
Fundamental analysis is a method or tool that investors use that seeks to determine the intrinsic value of a security by examining economic and financial factors. It considers macroeconomic factors such as the state of the economy and industry conditions.
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