EUR/USD Forecast October 24, 2017, Technical Analysis

The EUR/USD pair initially fell on Monday, bounced a bit towards the 1.1775 level, but then rolled over significantly to reach down towards the 1.1725 handle before slightly bouncing again. If we break down to a fresh, new low, it’s not only a negative sign, but it is also a breakdown below the neckline of the head and shoulders pattern that has been forming on the daily charts. That should send this market down to the 1.15 level rather quickly, and therefore I think that it’s likely we will continue to see US dollar strength. Rallies as selling opportunities from what I can see, unless of course we were to somehow break above the 1.18 handle, which I feel is rather unlikely.
I believe that the US dollar is going to strengthen in the short term, and we may be seeing a bit of a sea change as far as attitude is concerned. The US dollar has been oversold for quite some time, and we could see strength being a major part of the Forex markets going forward. However, if we were to break above the 1.18 level, that would be an extraordinarily bullish sign, and it should send this market looking towards the 1.20 level above. The market continues to be very volatile, and of course is a lot of speculation based upon the Federal Reserve, and that continues to look very hawkish indeed. With this in mind, I believe that the EUR/USD pair probably breaks down. I was bullish of this pair until recently, but as you can see the last couple of days have been very brutal for the uptrend, and I think that the sudden reversal of attitude will scare a lot of the previously bullish traders in this currency pair.