After a long period of uncertainty and a start to the bullish trend in May, the Eur / Usd cross could already retrace in early June. Here are the expert opinions and the euro-dollar forex forecast for June.
The euro takes off against the dollar. Where is the european currency headed? A month ago uncertainty in the forex was high and the forecasts were difficult, now at least for the EUR/USD cross it seems that something has changed, with euro strengthening against the dollar in the last part of May . However, supporters of the euro must not let go of easy enthusiasm: in fact, the road is still long and surprises may be around the corner.
Euro-dollar exchange rate: situation analysis late May/early June
From the beginning of April until tuesday 26 May, the EUR / USD prices moved in a wide trading range with support in 1.0775 area and resistance in 1.0984 area. Whenever the prices touched one of the two levels, there was immediately a rapid turnaround of the current trend.
With the closing of Wednesday 27 May, confirmed by the following ones, the balance broke and the prices started to rise. The bullish acceleration has been so sudden that the first price target in the 1.10585 area has already been reached and prices are now heading towards the second price target in the 1.13496 area. The maximum extension of the current increase is in area 1.1642 (third price target). A daily close below 1.10585 would put the bullish scenario in crisis and accelerate downward.
May was perhaps the turning point for the Euro Dollar exchange rate: EUR / USD broke 1.1, but above all, an absolutely most important element, it was able to consolidate above this level. The upward trend in progress seems to continue also on Monday 1 June. Is this enough to think that the Eur / Usd cross rally can continue or is it better to be cautious?
Eur / Usd forecast June 2020
It can be said that, until the third week of May had been the deepest uncertainty to dominate the forex, since the last week the rise of euro-dollar exchange rate above 1.1 has sent a clear signal for the short term. It is therefore conceivable that, at least in the first part of June, the Eur / Usd cross may continue its upward trend.
What will happen when the upward push runs out? Is it possible to retrace the quotations? From a technical point of view the situation of EUR / USD is complex and anyone who believes in a further strengthening of the euro against the dollar should remain down to earth.
It is true that in this phase of crisis the stock markets prefer a weak dollar, but it cannot be excluded that the euro-dollar cross may soon reach its point of arrival. In this case, it cannot be excluded that a downward movement could occur which would bring the change back to a range between 1.098 and 1.099.
Instead, the bullish view sees the euro-dollar rising up to 1.1145. If the EUR / USD cross reaches this level, it will also open the door at 1.124. Locking this level would be very significant, but the chances of this scenario being realized are low.
There is in fact a fundamental element to consider. Starting from the last week of May, the euro-dollar rate has benefited from the market tendency to favor exports from the US. A strong euro was convenient for many, but if the european currency were to stop appreciating now, then there would be an alarm signal also for the stock exchanges.
In short, at least for the first part of June, the trend will be closely linked to that of the stock exchanges.