FX.co ★ Hot forecast for EUR/USD on August 17, 2023

At first, the events developed exactly the same way as it did on Tuesday, and the euro edged up, but closer to the opening of the US trading session it started to trade lower. But the reason for this decline is quite interesting. It has nothing to do with economic reports, which the market continues to ignore. It is all about the minutes of the Federal Open Market Committee meeting, which was published quite late. But just before the opening of the US session, there were already rumors about it, which were eventually confirmed. It concerns the Federal Reserve's future course of actions. It turns out that due to the renewed growth of inflation, the US central bank is seriously considering the possibility of additional tightening. This gave the dollar a boost. After all, not long ago, most people were confident that there would be at most one more hike, or more likely no further monetary tightening. But now this changes things. In short, the market needs to consider the prospect of a higher level of interest rates, which is becoming more and more likely. This supports further strength in the US dollar.

In the course of the movement, the EUR/USD pair overcame the support level of 1.0900. As a result, there was an increase in the volume of short positions, which extended the corrective cycle.

On the four-hour chart, the RSI indicator is moving in the lower area of 30/50, thus reflecting bearish sentiment among traders.

On the same time frame, the Alligator's MAs are headed downwards, which points to the direction of the corrective phase

Outlook

Given the magnitude of the euro's weakness, it is possible to assume that a technical signal for overselling may appear soon. The 1.0800/1.0850 range may act as support for the sellers.

The comprehensive indicator analysis unveiled that in the short-term and intraday periods, indicators are pointing to the corrective move.