EUR USD – The euro dropped below the 1.00 Parity level

The Non-Farm Payroll (NFP) and unemployment rate report that gives the monthly measure of US labour markets health is due to be released today, September 3rd, 2022. Plus, the ECB interest rate decision is due next week. In the meantime, the US dollar has climbed to be within a striking distance of the 110.00 that dollar touched back in June 2000. Last week, Fed Chair Jerome Powell reiterated the need to deliver additional hikes to cool the inflation and refrained from going back on adopting a rate cutting strategy at this stage.

Chart Analysis

Euro continues to move in the descending channel, while currently trading just above the technical support or the Key Support level on the chart at 09920. The next level of support is at the support Zone at 0.9800 to 0.9750 and the next technical structural support is at 0.9540/0.9500 the Euro saw in 1989 Low / 2001 high. The EUR/USD chart shows that the last time Euro touched the parity with the US dollar was in mid-July and that support was tested Euro dropped below the July low on about 7 different occasions in the total past 9 sessions. It is appearing that EURO Bulls are pushing hard to keep the prices above the Key Support Level, and they might succeed too to convert this level into an Inflection point. However, historically, September is better for the US dollar and Gold and Euro tend to underperform, compared to the major currencies. So, there are chances that we might see a further downward move in the EUR/USD pair this month.

• Resistance Zone: 1.0322 to 1.0380
• Key Resistance: 1.0180
• Major Pivot Point: 1.0055
• Key Support Level: 0.9920
• Support Zone: 0.9800 to 0.9750
• 200 Day SMA – Green Line
• 50 Day SMA – Red Line
• 20 Day SMA – Blue Line

Daily Chart Directional bias - 1 Week

Trade Insights

EUR/USD Chart shows - Possible Long positions above the Key Support Level at 0.9920 with the first possible target of Major Pivot at 1.0055 and then the test of Key Resistance Level at 1.0180.

Possible Entry for Long trades above the S1 – Key support level at 0.9920

Potential first take profit could be at – R1 - 1.0055.

Potential second take profit could be at – R2 – 1.0180

Potential third take profit could be at –R3 – 1.0322 to 1.0380.

Alternatively, EUR/USD Chart shows - viable short Positions below the S1 Key Support Level at 0.9920 with the first possible target of the support zone at 0.9800 to 0.9750. and then towards the structural support at 0.9540/0.9500

Possible entry of Long Trades above the Pivot Apex point at 4036 on the chart. 

Potential first take profit could be at – S2 - 0.9800