EUR/USD Signal 24/09: Bearish Trend Continues As US Dollar

(MENAFN- Daily Forex) Bearish view

Sell the EUR/USD pair and set a take-profit at 1.1300. Add a stop-loss at 1.1450. Timeline: 1-2 days.

Bullish view

Buy the EUR/USD pair and set a take-profit at 1.1450. Add a stop-loss at 1.1300.

EUR/USD pair continued its strong downward trend and neared a crucial support level as the US dollar and crude oil prices jumped. It also slumped after the strong US manufacturing and services PMI data. It fell to a low of 1.1387, its lowest level since July 29.

Top Regulated Brokers1 Get Started 74% of retail CFD accounts lose money US Dollar and Crude Oil Price Surge Continues

The EUR/USD pair has been in a strong sell-off this year as the US dollar rally gained momentum. The US Dollar Index (DXY) jumped to 101.10, its highest level since July 29, and much higher than this month's low of 98.58.

This price action is happening as crude oil prices resume the uptrend. Brent, the global benchmark, rose to $103.30, while the West Texas Intermediate (WTI) rose to $92.38. Gasoline and diesel prices continued rising, raising concerns that inflation will continue rising.

Odds that the Federal Reserve will continue hiking interest rates rose after the US published strong flash manufacturing and services PMI numbers. The report showed that the manufacturing PMI rose from 53.9 in August to 57 in September.

Similarly, the services PMI figure rose from 56.5 to 58.7, higher than the sector median of 55.8. The composite rose from 56 in August to 58.4 in September. A PMI reading of 50 and above is a sign that a sector is growing.

Several Federal Reserve officials will talk today and provide more hints on what to expect in the coming months. Tom Barkin and John Williams will talk today and provide more details of the next Fed move.

The US will publish the latest building permits, initial jobless, and continuing jobless claims data.

EURUSD Chart by TradingViewEUR/USD Technical Analysis

The EUR/USD pair has been in a strong sell-off in the past few days, moving from a high of 1.1711 to the current 1.1386. It has plunged below the 50-day Exponential Moving Average (EMA).

The Average Directional Index (ADX) has jumped from this week's low of 26.3 to the current 30.85. A rising ADX indicator is a sign that the downward trend is accelerating. Also, the Relative Strength Index (RSI) has continued to fall.

Therefore, the pair will likely continue, possibly to the psychological level of 1.1300. This view will be confirmed if it drops below the important support level of 1.1354, its lowest level on July 28.

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