The EURUSD pair has started to look more bullish over recent weeks, with this in mind it is a good time to look at the possible price path for the euro in the first quarter of 2023.
With this in mind, the EURUSD I would expect that the pair is headed towards the 1.0500 level at some point, however, as the US dollar index continues to slide this could be a buying spot.
Other factors are currently weighing on the EURUSD pair, such as the expectation that the ECB will start to raise rates more aggressively than the FED.
I think a stronger recovery could be coming soon as the technicals looks much better above the 1.0800 to 1.1000 price range. Bullish patterns are engulfing the higher timeframes, so 1.1500 is possible in 2023.
I suspect the scene has been set for a new price trend if bulls can hold the price above the 1.0500 level and then finally a breakthrough above the 1.1000 resistance zone.
The ActivTrader Sentiment tool suggests that only 36% of traders are bullish on the EURUSD. This is still very positive for bulls if we consider that 64% of traders are short.
As traders, we typically look to fade retail sentiment when it is overly skewed in one direction. This style of trading, fading sentiment, has been one of the most effective and used tactics of hedge funds.
According to the daily time frame, the pair has rallied above a large falling trendline and has projection for the EURUSD around the 1.0800 level also at the top of the six-month range
Please note that the EURUSD pair has cleared all Ichimoku resistance on the mentioned time frame for the first time in nearly 18-months.
As long as the EURUSD pair stays above the 1.030 price level then medium-term analysis shows that further strength towards 1.1000 is possible.
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The EURUSD is currently showing a large, inverted head and shoulders pattern on the weekly time frame. The size of the pattern would indicate that a short-term bottom could be nearing around the 1.1000 area.
This is a bullish chart for the EURUSD over the short-term. This pattern is actually projecting a move of around 1,000 points. Ichimoku analysis also highlights the 1.1000 area as make or break for the EURUSD pair in 2023.
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