EUR/USD Forecast 11/09: Sideways Ahead Of ECB (Video)

(MENAFN- Daily Forex)

• The Euro has been back and forth against the US dollar during the trading session here on Wednesday, after PPI numbers in the United States came in cooler than anticipated.
• That being said, and I think more importantly, we are dead smack in the middle of consolidation between 1.16 on the bottom and the 1.18 level on the top.

ECB Meeting on Thursday

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I do think that it makes a lot of sense that this market doesn't really move much because Thursday, of course, we have the ECB interest rate decision coming out. And that obviously will have a major influence on the euro itself. As things stand right now, they are not expected to change the interest rate in Europe. But I think a lot of people will be watching very closely uh whether or not the statement changes, whether they start to show cracks in the economy. Ultimately, I think once we break out of this range, then you can start to have the conversation about where to place a trade in the short term, I'd be very cautious, but I'd watch both of these levels on the daily close in order to get a little bit of a feel for what it is worth.

Dollar Isn't Dead Yet

The US dollar, despite all of the bad economic news and the idea that the Federal Reserve is going to cut rates, has been hanging pretty tough with a lot of other currencies. So, all things being equal, this is a scenario where I think a lot of traders are looking at this through the prism of what comes next. Are we risk on or risk off? Because if the Europeans seem concerned and the Fed seems concerned, a lot of money will run to the dollar.

EURUSD Chart by TradingView

So, I expect a lot of choppy kind of noisy action in the short term. But I suspect by the time we get through Thursday of next week when the Fed speaks, we might have clarity for a bigger and more longer term move.

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