EUR/USD Forex Signal: Rising Wedge Pattern Forms| MENAFN.COM

Saturday, 04 February 2023 09:21 GMT

EUR/USD Forex Signal: Rising Wedge Pattern Forms

(MENAFN- Daily Forex) Advertisement see for yourself why eur/usd is the most traded pair trade eur/usd now Bearish view
  • Sell the eur/usd pair and set a take-profit at 1.0865.
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Bullish view
  • Buy the EUR/USD pair and set a take price at 1.1050.
  • Add a stop-loss at 1.0870.

The EUR/USD price has formed a rising wedge pattern ahead of the upcoming American economic data. It was trading at 1.0912, which was a few pips below this week's high of 1.0926. This price is more than 12% above the lowest point in 2022.US GDP and new home sales data

The EUR/USD price continued its bullish trend ahead of the important economic data from the US. The statistics agency will publish the first estimate of the fourth-quarter GDP data in the afternoon session. Economists polled by Reuters expect that the economy slowed slightly in the fourth quarter.

The median estimate that the economy slowed from 3.2% in the third quarter to 2.6% in Q4 as inflation held consumer spending. Corporate spending has also been slowing as companies continued worrying about the rising risks of a recession. Economists expect that the GDP price index dropped from 4.4% to 3.3%.

The US will also publish the latest new home sales numbers for December. With interest rates and mortgage rates surging, economists expect that new home sales dropped by 4.7% in December after rising by 5.8% in the previous month. Other housing-related numbers like pending home sales and prices have been falling.

The US will also release the latest durable goods order numbers, which are important measures of the state of the economy. Economists believe that core durable goods orders dropped by 0.2% in December after rising by 0.1% in November. The other important numbers will be the latest initial jobless claims data.

These numbers are important because they come a week ahead of the upcoming interest rate decision by the Federal Reserve. Economists believe that the fed will deliver the second straight 0.50% rate hike.EUR/USD forecast

The EUR to USD exchange rate has been in a strong bullish trend in the past few months. As a result, the pair remains above the 25-day volume-weighted moving average (VWMA). Most recently, the pair has formed a rising wedge pattern, which is shown in red. This is one of the most bearish patterns in price action analysis.

Therefore, with the pattern nearing its confluence level, there is a likelihood that the pair will have a bearish breakout ahead of the FOMC decision. Before then, the outlook of the pair is neutral with a bearish bias.

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