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01.10.202408:37 Forex Analysis & Reviews: Hot Forecast for EUR/USD on October 1, 2024

Although Jerome Powell repeated his words during the press conference following the recent Federal Open Market Committee meeting, the dollar was actively rising. The head of the Federal Reserve didn't say anything new. However, the strengthening of the dollar began several hours before his speech and essentially ended before it even started. The reason is that other officials from the US central bank also spoke. And their rhetoric has changed somewhat. In particular, Raphael Bostic, who had previously clearly supported another 50 basis points cut in interest rates, suddenly made a reservation that this step would only be justified in case of a sharp deterioration in the labor market situation. This significantly increased the importance of the United States Department of Labor report, which will be published this Friday. However, given that no one expects a sudden spike in unemployment, such statements simultaneously reduced the likelihood of such a substantial interest rate cut. Thus, the strengthening of the US dollar became a logical development.

At the same time, there is a high probability that today, the dollar will continue to strengthen its position. This time, the reason will be the preliminary inflation data in the Eurozone, which indicates that consumer price growth may slow down from 2.2% to 1.8%. However, the dollar's growth will be limited because interest rates were already lowered by 60 basis points during the recent European Central Bank meeting. In other words, the ECB has already accounted for the further decline in inflation. Nevertheless, inflation falling below 2.0% still creates preconditions for further monetary policy easing, though not immediately but in the near future.

Exchange Rates 01.10.2024 analysis

The EUR/USD currency pair has been moving at the peak of the upward cycle for the fifth consecutive day. The resistance level is 1.1200, below which a price stagnation has formed.

In the four-hour chart, the RSI technical tool has crossed the median 50 line in a downward trajectory, indicating an increase in the volume of short positions on the euro.

As for the Alligator indicator in the same time frame, the moving average (MA) lines have changed direction, suggesting price stagnation.

Expectations and Prospects

It can be assumed that the stagnation serves as a stage of regrouping trading forces, with the bullish sentiment preserved among market participants. In this case, stabilizing the price above the 1.1200 mark during the day could lead to an update of the mid-term trend's high, which is at 1.1276. Otherwise, we expect further fluctuations around the current values.

The complex indicator analysis in the short-term and intraday periods points to a pullback.

*La presente analisi del mercato ha un carattere esclusivamente informativo e non rappresenta una guida per l`effettuazione di una transazione.

Dean Leo,
Analytical expert of InstaSpot
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