Judging by what is going on in the forex market, media attention has shifted away from the energy crisis in Europe. At least, they no longer provide detailed insights into the situation.
Energy prices have somewhat stabilized but remain extremely high. Many European governments are announcing the allocation of additional funds to support local businesses and consumers.
Nevertheless, an increase in the euro has been rather limited. The currency is now moving the same way it did on Sept. 16-17, when it moved slowly and then plunged.
Indeed, there has not been any negative or positive news so far. All this indicates that this is going to be a long-lasting crisis with catastrophic consequences for the entire economy. These particular concerns are weighing on the euro at the moment.
The euro is likely to be at a standstill today, as well as to show an insignificant increase in value. Within the past several days, the euro suffered a massive drop. However, this assumption may come true if only there will be no pessimistic reports on the state of the European energy market.
Within the past 5 days, the euro lost around 150 pips. Such a significant change in value pushed the price to the overbought zone. The Relative Strength Index (RSI) fell below 27, signaling the possibility of a rebound.
The quote reached the support level of 1.1700, where an increase in the volume of long positions took place.
Speaking of the daily time frame, the greenback recovered by about 85% in terms of a correction as of Aug. 23-Sept. 3.
Outlook
The market is now bearish. The price is moving down from the resistance zone of 1.1880/1.1905. A rise in the volume of short positions is expected at the moment the quote consolidates below 1.1700 on the H4 chart.
In terms of complex indicator analysis, technical indicators are signaling to buy the pair in the short term and sell it intraday.
InstaForex Group