The EUR/USD exchange rate entered the new week’s trading once again, determined to break the parity rate. The currency pair actually crashed towards the 0.9926 support level, the lowest for the currency pair in two decades. It settled around the 0.9950 level ahead of the announcement of the PMI readings for the manufacturing and services sectors for the economies of the euro zone amid expectations of a further slowdown in the bloc’s economy due to the continuation of the Russian-Ukrainian war and its repercussions.

The euro briefly benefited after ECB Executive Board member Isabelle Schnabel suggested last week that a second 0.50% increase in ECB interest rates for September should not be ruled out, but her relief from selling pressure was temporary. The euro was quick to collapse back toward parity during the latter half of last week after remarks on Wednesday from a string of Fed officials reopened the market debate over whether the Fed might opt ​​for a third 0.75% increase in US interest rates. The next meeting is in September.

Commenting on the performance, Jordan Rochester, FX analyst at Nomura said, “The euro has been very range bound, but we don’t think that will last. There has been a huge imbalance of euro shorts since parity was reached, governments began to share high energy costs with consumers, companies will have to start cutting production slowly, while supply lines are being damaged by a lack of transportation options and low water levels on the Rhine.”

“The market could also start the price to fall softer in the US, with an eye on PMIs this week if we bounce back, as seen in the Philadelphia Fed survey, it could keep the euro under pressure as well,” the analyst added. The Analyst’s view is a reconfirmation of expectations that EUR/USD will fall back to 0.9750 by the end of September.

EUR/USD Economic Data

The euro recovered from the strength it lost earlier in July after some US economic figures indicated that the economy may be close to recession, while other data indicated that inflation pressures may have moderated in recent months, leading to speculation about a possible slowdown in the economy. This is the rate at which stagnation occurs. The Fed is likely to raise interest rates next year.

US employment figures and other data mocked concerns about the health of the economy earlier this month, while some members of the Federal Reserve’s rate-setting committee continued to pay short attention last week to the concept of a slowdown in the pace of policy normalization. In the future, resulting in a simultaneous recovery in US bond yields and the dollar.

• EURUSD will be sensitive this week to the message and implications of the latest S&P Global Manufacturing and Services PMI surveys on Tuesday, especially if they show any signs of bottoming out expectations for European economies.
• Thursday’s July ECB meeting minutes are also likely to be poured, although much about the euro’s future will depend on the dollar’s response to economic figures due out of the US ahead of Federal Reserve officials’ comments on Friday.

EUR/USD forecast today:

The general trend of the EUR/USD currency pair is still bearish. Stability below the parity price confirms it is stronger. Continuing control of the bears on the trend and is warning of a stronger downward move if the weakness factors of the currency pair persist. The euro may remain under pressure from fears of a complete cut off Russian gas from Europe. Therefore, any attempts for the EUR/USD pair to rebound higher will be subject to selling.

The closest support levels for the euro dollar today are 0.9920, 0.9835 and 0.9770, respectively. On the other hand, on the daily chart, breaking the resistance 1.0200 will be important for an initial break of the current downtrend. The Euro will be affected by the announcement of the PMI readings for the manufacturing and services sectors for the Eurozone economies. From the United States, the PMI reading for the manufacturing and services sectors and US new home sales will be announced.

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If you have a longer-term belief in crypto, you know what you should be doing right now.

Ethereum has rallied a bit during the trading session on Thursday to reach the $1250 level. The area is a major resistance barrier that we have seen over the last several weeks and have been trading back and forth from. The $1250 level above offers a bit of a “ceiling”, and at this point, it’s likely that the $1000 level underneath will continue to offer support. If we were to break down below the $1000 level, the market then could go down to the $900 level.

If we were to break down below the $900 level, it’s very likely that Ethereum will break down drastically, and then perhaps even to the $500 region. This is an area where I would anticipate seeing a lot of buyers, but perhaps it may take a while for accumulation to turn things around. That being said, the market is likely to see “crypto winter” continue, meaning that we have a scenario where the attitude of the market is simply sideways, and larger players are starting to build up massive amounts of Ethereum for a bigger play. After all, the market has done this multiple times in the past, so certainly there are people out there willing to jump in and take advantage of cheap Ethereum so that they can build up a huge position.

If the market were to break down, then I think that area right around $500 could be a longer-term area as well. Ultimately, I think this is a market that will eventually turn around, but you need a turnaround in central banks in order to show signs of slowing down when it comes to monetary policy tightening. That is more likely than not going to be quite a while down the road, so I don’t have any interest in trying to get too cute at this point, but I do recognize that we have a scenario where we will eventually turn things around.

As for myself, I’m starting to accumulate small bits and pieces of Ethereum for the next run higher, but with the slow rollout of Ethereum 2.0, monetary policy, and a lot of “risk-off” attitude, it’s not a huge surprise to see that we are struggling to go higher. Because of this, if you have a longer-term belief in crypto, you know what you should be doing right now.

This could be accumulation season, but I think there is so much time to do it that you can enter the market very slowly.

The Bitcoin market has rallied a bit during the trading session on Thursday as we continue to go sideways. Ultimately, the market is trying to figure out whether or not this is a floor, or if it’s Further to go to the downside. Quite frankly, it does not really matter at this point, because any rally will be treated with significant suspicion.

While I do not necessarily think that the market is going to completely collapse, the reality is that we could see a bit of a pullback from here. When you look at longer-term charts, it would not take much to imagine a scenario where we reached the $18,000 level, and then eventually break through it. If we did, it opens up the possibility of a move down to the $1200 level, an area that I think will continue to see a lot of support as well. This is based upon “market memory” that happened in that area, so I think it’s probably only a matter of time before we would see a bit of accumulation in that area. In fact, I would be more likely than not willing to start buying and building a big position.

If we do break to the upside, basically clearing the $22,000 level, it’s possible that we could go looking to the 50 Day EMA, and then possibly the $28,000 level. There is a massive amount of resistance between the $28,000 level that extends to the $32,000 level, and therefore I think it’s only a matter of time before we see exhaustion that will kick off more selling. I just don’t see the argument for Bitcoin taking off to the upside from here, at least not until the Federal Reserve does something about its monetary policy, and lifts the idea of risk appetite coming back into the financial markets.

As things stand right now, I think you have plenty of time to build up a position, so don’t feel necessarily overly pressed to get involved here. We are most certainly still in a downtrend and need to form a huge basing pattern before things turn around again and take off. In other words, this could be accumulation season, but I think there is so much time to do it that you can enter the market very slowly.

Ultimately, we will go much lower and I think the trend will continue.

The British pound fell rather hard on Tuesday to slice through the 1.20 level. The market continues to show quite a bit of negativity, as we continue to see a lot of US dollar strength in general. The 1.20 level is a large, round, psychologically significant figure, and an area where we had bounced from previously. Because we have broken through it, that does suggest to me that we have further to go to the downside.

Beyond that, this is a market that has been in a downtrend for quite a while. The size of the candlestick is rather negative and large. The fact that we are closing at the bottom of the range of the candlestick does suggest that there should be a bit of follow-through, and therefore I would not be overly surprised to see this market continue lower. If it does continue to break down, the 1.18 level will more likely than not end up being a target, followed by the 1.16 level.

Any rally at this point in time looks suspicious, so  I wll be looking for signs of exhaustion to start shorting. The 1.20 level is the first barrier above, but even if we were to break above there, I think the 1.22 level is an area where a lot of sellers have been involved, and therefore I think that is going to be difficult to get above. Furthermore, the 50-day EMA sits at the 1.24 handle, the market is likely to see that as a dynamic resistance. With the Federal Reserve tightening monetary policy, it does make quite a bit of sense that we will continue to see the US dollar strengthen.

The US dollar should continue to be sought after as it looks like the global economy is going to continue to slow down, making the need for US dollars much more important. The British pound itself is not necessarily a currency that I am overly worried about, but in this scenario, it’s all about owning the greenback. Ultimately, we will go much lower and I think the trend will continue. It’s also worth noting that until the Federal Reserve changes its attitude, it’s difficult to imagine that this market will do anything but correct from time to time, and not change its overall attitude anytime soon.

Bitcoin rallied a bit Monday, but pales in comparison to the massive selling that we had seen previously. Because of this, I think it is only somewhat positive, and we more likely than not will have plenty of headwinds above that continue to work against the value of the market. If that’s going to be the case, then I am more than willing to fade rallies as they occur.

In the short term, the $23,000 level looks to be a significant barrier, one that the market has no real momentum to break above. Even if it did, I suspect that there is a major ceiling near the $28,000 level that extends to the $32,000 level. While Bitcoin itself is still the “gold standard” when it comes to crypto, the reality is that it is just as sensitive to Federal Reserve monetary policy as gold. For the longest time, the argument was that Bitcoin was going to be a “hedge against inflation.” That has certainly shown itself to not be true.

You can’t call it a store of wealth either, because quite frankly anything like that can’t lose half of its value every time something bad happens. This is not to say that the market will go higher over the longer term, because I do believe that it will. It’s just that you need to understand that you are speculating in a highly volatile asset class, and you need to understand the inherent risks in doing so.

If and when we break down below the $18,000 level, and I do believe that’s more of a “when” than “if” type of statement, we should go looking toward the $16,000 level, and eventually the $12,000 level. There are so many people waiting for the $12,000 level to be tested, I suspect that there will be a lot of inflow into this market when that happens. It’s also worth noting that the $12,000 level was crucial before, so I do anticipate that a lot of “market memory” will occur there, causing previous resistance to be support. Because of this, I think you have plenty of time to accumulate a position, but if you choose to do so quietly and slowly, that’s also a possibility here. Either way, I am not expecting Bitcoin or any crypto for that matter to break out to the upside anytime soon.

The “meme coin trade” has been taken out back and shot.

The Shiba Inu coin has rallied about 3% during the training session on Thursday as we continue to see the market try to lift itself up off of its back. Because of this, it is possible that we see a little bit of momentum to the outside, but the 50 Day EMA sits just above, and it does suggest that there could be a bit of dynamic resistance. With that in mind, the next bullish sign would be to see Shiba Inu break above the 50 Day EMA on a daily close, allowing for the market to clear a technical barrier.

On Tuesday, we had seen a huge push higher in this ecosystem, so it does make a certain amount of sense that we would see an attempt to do a bit of follow-through here. That being said, the market is more likely than not going to continue to be bullish, because quite frankly the rest of the crypto markets are negative. Shiba Inu has no real use case scenario at the moment, and as a result, this “meme coin” will probably go the way of the dodo given enough time. Yes, I understand there is the Shiba Army out there, but the Army is getting smaller, and quite frankly hasn’t won a battle in a while.

The 200 EMA is near the 0.00002000 area, so therefore I think that at best you would see a pop to that area. After all, if Bitcoin is struggling to find buyers, then Shiba Inu most certainly will as well. This market continues to move to the downside, seeming ready to test the zero level. Whether or not Shiba Inu even exists in another year is a whole different question, but right now I just don’t see how this thing takes. We would need to see massive risk appetite returned to the crypto market, as well as the rest of the world. The market continues to be one that I would avoid, right along with the rest of crypto. Quite frankly, the smaller coins are in the process of disappearing, and at this point, it’s unknown as to which ones actually will survive. The next year is going to be very crucial for these markets, so pay close attention. The “meme coin trade” has been taken out back and shot.

The German index has lowered to kick off trading on Monday and then fell straight down to the floor. That’s not a huge surprise, due to the fact that the inflation numbers in the United States were horrific on Friday, and it looks as if we are going to continue to see a lot of negativity around the world. If the Federal Reserve continues to need to tighten monetary policy, it does make a certain amount of sense that we will continue to see more of a “risk-off” type of attitude globally.

If the DAX is falling apart, you can bet your bottom dollar that a lot of the other smaller indices are doing the same thing and will continue to do so. Yes, we are a bit overextended to the downside, but at this point, it’s likely that we will continue to see this area underneath as a potential support level that could cause a bit of a bounce, but it also looks like it will get shot through. Ultimately, I think we break down below there and go looking to the 12,500 level. Rallies at this point should see plenty of resistance at the 50 Day EMA, as well as the 14,000 level.

Moves like this generally do have a bit of follow-through, but they also tend to have a bit of a bounce as markets cannot go in one direction forever. However, if we were to break down below the bottom of the candlestick for the day, I think that would only show an exacerbation of the nastiness in this market. The EU has a world of problems right now, and at this point, it’s likely that they will continue to see reasons to sell every time we rally. The European Union is very soft at the moment, and also has to worry about minor things like powering an economy!

It’s not until we start to see the US indices turnaround that we will more likely than not see the European Union recover. By European Union, I mean Germany. Germany is roughly 82% of the European Union, so this index will lead the rest of them around the continent, so even if you’re not trading this particular market, you should always keep an eye on it. At this point, it looks miserable.

Crypto seems to be a bit of a solution looking for a problem, and there’s been almost no adoption.

Bitcoin fell a bit Friday as we continue to see the US dollar strengthen overall. This will continue to work against the value of Bitcoin, as it is highly susceptible to greenback pressure. After all, it is priced in those very same dollars, and we are in a situation where risk appetite is without a doubt poor, to say the least. In this scenario, it’s difficult to imagine why people would want to jump into Bitcoin or any other crypto and take advantage of “value”, when they are more likely than not going to be offered “more value” sooner rather than later.

The $28,000 level underneath being broken to the downside opens up the possibility of a move down to the $25,000 level. If we break down below there then it’s likely that we could challenge the $20,000 level. When you look at the longer-term chart, we have broken down significantly, and at this point in time we are just below what had been massive support previously. If we break down from here and continue to see a lot of negativity in the crypto markets, we could see Bitcoin going all the way down to $12,000, making it a complete “round-trip” from the most recent bullish market.

I get a lot of flak online about my thoughts on crypto, but the last time crypto acted like this, Bitcoin fell all the way down to $3000 and was essentially forgotten about for a couple of years. I do believe that we are getting dangerously close to something like that happening. Yes, Bitcoin will probably fare better this time, but still, it’s obvious to me that there has been far too much in the way of frothy behavior in the crypto markets.

I expect to see a lot of the smaller coins completely disappear in the next year or two. Some of the great projects will get eviscerated because there are far too many projects out there trying to solve the same problem. Crypto seems to be a bit of a solution looking for a problem, and there’s been almost no adoption. Bitcoin has the best chance, but that’s only because so much institutional money had jumped into the market. Whether or not it’s actually used in the real world will be a completely different conversation, but what I do know is that it’s pretty rare to see somebody use crypto for payments.

There are a lot of concerns out there that will continue to weigh upon bullish pressure.

The S&P 500 has rallied significantly during the trading session on Thursday to show signs of bullish pressure yet again. It appears that the market is willing to overlook a lot of things right now, perhaps with the idea that the Federal Reserve will save everybody. Whether or not they will is a completely different question, but at this point it does not seem like the market is living in reality. However, the 4300 level could be the target, but you need to keep in mind that it is also jobs report Friday and therefore it’s likely be very volatile to say the least.

I’ll pull back, the 4100 level should be supported, but I think that we probably go lower than that if we get a lot of bad news. If we break down below the 4100 level, then the 4000 level will be targeted, followed by the 3900 level. We are in a downtrend, but bear market rallies tend to be very vicious. Wall Street always find some type of narrative to push stocks higher, so one would have to assume that there is a lot of narrative telling out there right now. Ultimately, I think this is a market that will continue to be very difficult, and noisy to say the least.

I am looking for signs of exhaustion to short in this market, but if we were to break above the 4300 level I’d have to throw in the towel. At that point, you just follow price action because it doesn’t need to make sense. If there’s one thing that Wall Street has taught us, a narrative can go a long way. Indices are built to go higher over the longer term, so that’s why shorting them is generally a very dangerous thing to do. After all, they are built of the largest stocks, and they are not equal-weighted. In other words, all of the “big boys” are what make up most of what you are looking at. In that scenario, it’s very likely that you will continue to see a natural lift higher. However, there are a lot of concerns out there that will continue to weigh upon bullish pressure. With that in mind, I think it’s going to be worse, not better over the next several weeks.

The buyers are becoming just a bit more aggressive as of late.

The West Texas Intermediate Crew Oil market rallied during the training session on Thursday to slam into the $115 level. As you can see on the chart attached, I have drawn a line at that area, and you could make an argument for some type of ascending triangle, or something similar to it at this point. I like the idea of buying dips, and I do think that every time this market pulls back there will be buyers willing to step in and try to take advantage of any type of value.

The 50 Day EMA is sitting at the $105 level and is rising. Ultimately, I think that it offers dynamic support as you have seen multiple times in the past, but I would think of it more as a “spongy area” as it hasn’t acted like a trend line. In fact, you could even make an argument for an uptrend line underneath that level, and it coincides quite nicely with the $100 level. The $100 level is a large, round, psychologically significant figure, so I think that if you were to break the role of that, then you can start to have an argument to the downside. Nonetheless, this is a market that I think will remain bullish for the foreseeable future, but not quite as strong as in the past.

On a break above the $116 level would clear the market for a move to the $120 level, possibly even the $125 level. I think at this point in time, we will more likely than I see that happen, because of everything that’s going on with the crude oil supply around the world. We continue to see a lot of concerns when it comes to the Russian supply as well, even though they are selling crude oil to a handful of major importers, such as China and India.

Think of this as a market that you need to find value in, and I would also point out that the most recent dip was much shallower than the three previous dips before that. That suggests that we are starting to see a build in momentum, and I do think that is something that’s worth paying attention to. In other words, the buyers are becoming just a bit more aggressive as of late.