EURUSD Future Direction Hinges on This

by Justin Bennett  · 

January 24, 2023

by Justin Bennett  · 

January 24, 2023

by Justin Bennett  · 

January 24, 2023

EURUSD is attempting to breakout above 1.0870, which has capped every advance since January 12th.

If you’ve seen the recent Weekly Forex Forecasts, you know that 1.0870 is the December 2016 trend line that shows incredibly well on the weekly chart.

EURUSD weekly chart with 1.0870 as resistance
EURUSD weekly time frame

The EURUSD has also respected the weekly level above on the daily time frame.

You can see in the chart below how the euro has yet to close a day above 1.0870.

However, that hasn’t stopped bulls from trying.

If EURUSD can get above this 1.0870 region on a daily closing basis, the next stop is the 1.1120 resistance area.

Of course, anyone trading the euro or any major currency pair should keep the US Dollar Index (DXY) on their radar.

I’ve discussed it before, but the 101.00 area remains critical support for DXY.

US Dollar Index (DXY) support and resistance
US Dollar Index (DXY) daily time frame

Any retest of the 101.00 area for the DXY will likely attract significant demand, putting pressure on pairs like EURUSD.

But, for now, the EURUSD uptrend is intact. The only thing left is securing a daily close above 1.0870 to open up 1.1120.

I will only turn bearish on the euro if we see a daily close below the 1.0700 area, as that would expose levels like 1.0480.

Until then, the short-term momentum favors bulls.

EURUSD daily time frame showing potential breakout
EURUSD daily time frame

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  1. Justin, glad you’re back. This site is real fine piece of work. It’s clean, easy to move around on. Very well thought out and above all… helpful.

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