Forecast for EUR/USD on July 23, 2020

EUR/USD

The euro rose by 42 points on Wednesday, marking the upper shadow of exactly 50% of the movement from February 2018 to March 2020. On the technical side, this growth increased the probability of a divergence with the Marlin oscillator. The resulting divergence line becomes less steep. After consolidating the price at 1.1560, we are waiting for the price at the important level of 1.1420, passing through the June 10 high.

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The hot news about the European recovery fund worth 750 billion euros is already cooling, since the bulk remains within the core of the eurozone, their distribution is not fair among the countries affected by the epidemic, and grants will be distributed for several more years. And a new hot news came on the scene – the US is closing, or rather, ordered China to close their consulate in Houston, which further increases the tension between the countries and, accordingly, reduces the desire of investors to buy risky currencies.

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The signal line of the Marlin oscillator turned from the overbought zone on the four-hour chart. A more definite signal for a reversal will occur when the price goes under the MACD line, approximately under the 1.1490 level, to which this line tends.

Summary: an advice to close long positions and wait for conditions confirming the reversal to form.

The material has been provided by InstaForex Company - www.instaforex.com