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The Euro has continued its downward spiral against the US Dollar, breaching the 1.06 level on Tuesday. This marks a significant decline for the currency pair, which has been under pressure for several weeks.
Why is the pair declining?
Several factors are contributing to the Euro’s weakness:
US Economic Strength: The US economy remains relatively robust, with expectations of higher inflation figures for October. This strengthens the US Dollar’s appeal.
Eurozone Economic Concerns: The Eurozone’s economic outlook is less optimistic, with potential for slower growth. Technically, it is suggested that a strong bearish trend for EUR/USD is in the making, with key moving averages acting as resistance.
What’s Next for EUR/USD?
Short-Term Outlook: The pair is likely to face further downward pressure, with potential support levels at 1.0600 and 1.0500.
Long-Term Outlook: A sustained break above the 200-day EMA could signal a reversal of the trend, but this seems unlikely in the near future.
Overall, the bearish sentiment surrounding EUR/USD is strong, and traders should be cautious about taking long positions.
