FX.co ★ Technical Analysis of EUR/USD for February 2, 2023

Technical Market Outlook:

The EUR/USD pair made a new swing high at the level of 1.1033 (at the time of writing the analysis) after the FED hikes the interest rate from 4.5% to 4.75% as expected. The up trend on EUR/USD is continued and the bulls managed to retrace 50% of the last big wave down, so now the next target is seen at 61% Fibonacci retracement located at 1.1276. The momentum has entered extremely overbought market conditions, so a pull back and test of the level of 1.0929 is expected soon.

Weekly Pivot Points:

WR3 - 1.09496

WR2 - 1.09130

WR1 - 1.09001

Weekly Pivot - 1.08764

WS1 - 1.08635

WS2 - 1.08398

WS3 - 1.08032

Trading Outlook:

Since the beginning of October 2022 the EUR/USD is in the corrective cycle to the upside, but the main, long-term trend remains bearish. The EUR had made a new multi-decade low at the level of 0.9538, so as long as the USD is being bought all across the board, the down trend will continue towards the new lows. In the mid-term, the key Fibonacci retracement level is located at 1.0945 (50% Fibonacci retracement) and only if this level is clearly violated, the down trend might be considered terminated.