empty
04.09.2024 12:40 PM
EUR/USD. September 4. U.S. Economy Faces Challenges Again

On Tuesday, the EUR/USD pair once again rebounded from the 161.8% corrective level at 1.1070, leading to a reversal in favor of the U.S. dollar. Currently, the pair is heading towards the 1.1070 level again. A third rebound from the 1.1070–1.1081 zone could signal a continued decline towards the 127.2% Fibonacci level at 1.0984. If the pair consolidates above the 1.1070–1.1081 zone, we could see some growth towards the 200.0% corrective level at 1.1165.

This image is no longer relevant

The wave structure has become a bit more complex, but it remains generally clear. The last completed upward wave broke the peak of the previous wave, while the new downward wave hasn't yet approached the last low from August 15. Thus, the current trend remains bullish. For this trend to reverse, bears would now need to break the low of the most recent downward wave, which is near the 1.0950 level.

Tuesday's news once again brought no significant support for the U.S. dollar. The ISM Manufacturing Index performed better than last month, but the S&P Manufacturing Index showed a decline from 49.6 to 47.9. As a result, Tuesday's news cannot be considered a positive for the dollar. Throughout the day, bears made several attempts to apply pressure on the pair, but these efforts were weak and lacked conviction. As I mentioned earlier, this week's developments will heavily depend on the news flow. So far, there has been little news, and it has allowed the dollar to maintain its recently gained positions. However, the first weak report could trigger a revival of the bulls. Today, the JOLTS report might be that trigger. If the number of job openings falls below expectations, we may see consolidation above the 1.1070–1.1081 zone. The market still expects aggressive rate cuts from the Federal Reserve by the end of the year, which remains a key risk factor for the U.S. dollar.

This image is no longer relevant

On the 4-hour chart, the pair has consolidated below the 100.0% Fibonacci level at 1.1139. This suggests a potential decline in the euro towards the 76.4% corrective level at 1.1013. A rebound from the 1.1013 level could signal a reversal in favor of the euro and some growth towards 1.1139. Currently, no divergences are observed in any indicators.

Commitments of Traders (COT) Report:

This image is no longer relevant

In the latest reporting week, speculators opened 24,031 long positions and closed 12,790 short positions. The sentiment of the "Non-commercial" group turned bearish several months ago, but bulls are actively dominating at the moment. The total number of long positions held by speculators is now 218,000, while the number of short positions is 125,000.

I still believe the situation will continue to shift in favor of the bears. I see no long-term reasons to buy the euro. It's also worth noting that the market has already priced in a 100% chance of a rate cut by the FOMC in September. The likelihood of a euro decline remains significant. However, we must not forget about technical analysis, which currently doesn't indicate a sharp euro decline, nor the news background, which regularly throws obstacles in the dollar's path.

U.S. and Eurozone News Calendar:

  • Eurozone – German Services PMI (07:55 UTC)
  • Eurozone – Services PMI (08:00 UTC)
  • U.S. – JOLTS Job Openings (14:00 UTC)

The September 4 economic calendar contains three key events. The news impact on market sentiment in the second half of the day could be moderate.

Forecast for EUR/USD and Trader Recommendations:

Selling the pair could be considered after a rebound from the 1.1070–1.1081 zone, targeting 1.0984. These trades can still be held open. Buying will be possible if the pair closes above the 1.1070–1.1081 zone on the hourly chart, targeting 1.1165.

The Fibonacci levels are based on the 1.0917–1.0668 range on the hourly chart and 1.1139–1.0603 on the 4-hour chart.

Samir Klishi,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

EUR/USD: January 20th. A Crucial Week for the Dollar

On Friday, the EUR/USD pair continued to trade sideways between 1.0255 and 1.0336. The market has taken a pause ahead of Donald Trump's inauguration and is waiting for further developments

Samir Klishi 13:36 2025-01-20 UTC+2

Forecast for GBP/USD on January 20, 2025

On Friday, the GBP/USD pair continued to trade sideways on the hourly chart, completely ignoring the 1.2191 level. As this is a classic range-bound movement, it's best to wait

Samir Klishi 13:27 2025-01-20 UTC+2

Video analysis for January 20, 2025

Potential for the further rally on Nasdaq

Petar Jacimovic 12:24 2025-01-20 UTC+2

Forex forecast 20/01/2025: EUR/USD, GBP/USD, USD/JPY, SP500, Gold and Bitcoin

Useful links: My other articles are available in this section InstaForex course for beginners Popular Analytics Open trading account Important: The begginers in forex trading need to be very careful

Sebastian Seliga 10:59 2025-01-20 UTC+2

EUR/USD and GBP/USD on January 20 - Technical Analysis of the Situation

The daily short-term trend continues to hold the market close. Today, it has shifted to the lower part of the consolidation zone (1.0269) as if encouraging bullish players to take

Evangelos Poulakis 06:52 2025-01-20 UTC+2

Technical Analysis of Daily Price Movement of USD/IDR Exotic Currency Pairs, Monday January 20, 2025.

With the appearance of the Rising Wedge pattern and Divergence between the price movement of the exotic USD/IDR currency pair with the RSI indicator (5), it confirms the potential

Arief Makmur 05:22 2025-01-20 UTC+2

Technical Analysis of Daily Price Movement of Crude Oil Commodity Instrument, Monday January 20, 2025.

On the daily chart, the Crude Oil commodity instrument can be seen after successfully breaking through the Failing Wedge pattern, a divergence appeared between the #CL price movement

Arief Makmur 05:22 2025-01-20 UTC+2

Forecast for EUR/USD on January 20, 2025

Today, the euro begins trading within the range established on January 15, where it remained throughout last week. Market attention is heavily focused on the inauguration of Donald Trump

Laurie Bailey 03:52 2025-01-20 UTC+2

Forecast for GBP/USD on January 20, 2025

The decline of the pound on Friday is significantly different from its behavior over the previous four sessions. The day closed with a stark black candle below the 1.2186 support

Laurie Bailey 03:52 2025-01-20 UTC+2

Forecast for USD/JPY on January 20, 2025

On Friday, the USD/JPY pair bounced off the MACD line's support, indicating a correction after a two-day decline. The Marlin oscillator's signal line reversed downward from the neutral zero line

Laurie Bailey 03:52 2025-01-20 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.