Uncovering the EUR/USD and DXY Outlook for July 2023: Navigating Resistance and Support
Introduction
Following today’s US Core PCE data, next week’s ISM manufacturing and services PMIs are expected to inject volatility into the markets ahead of Friday’s non-farm payrolls. The ISM Manufacturing PMI has been consistently underperforming since May, while the ISM Services PMI has been showing strength, raising concerns about the risks to declining inflation rates.
EUR/USD Outlook
The EUR/USD pair has been trading within a narrow range for the past few weeks, unable to break above the 1.20 resistance level. With the upcoming economic data releases, traders will be closely watching for any signs of a breakout. If the ISM manufacturing and services PMIs come in better than expected, we could see the EUR/USD pair testing the 1.20 resistance once again. On the downside, strong support is seen at the 1.18 level.
DXY Outlook
The US Dollar Index (DXY) has been trading in a downtrend for the past month, as concerns about rising inflation and slowing economic growth weigh on the greenback. The key support level to watch is around 90.50, and if the index breaks below this level, we could see a further decline towards 90.00. On the other hand, if the DXY manages to bounce back from the support level, we could see a retest of the 91.50 resistance level.
Impact on Individuals
Individual traders and investors who are involved in the forex market may experience increased volatility in their open positions as a result of the upcoming economic data releases. It is important to closely monitor the news and be prepared to make timely decisions to manage risk effectively.
Impact on the World
The performance of the EUR/USD pair and the DXY is closely watched by central banks, governments, and international institutions around the world. Any significant moves in these currency pairs could have implications for global trade, monetary policy decisions, and overall market sentiment. It is crucial for policymakers to analyze these trends and adjust their strategies accordingly to mitigate any potential risks.
Conclusion
In conclusion, the outlook for the EUR/USD pair and the DXY in July 2023 is uncertain, with key economic data releases expected to drive market sentiment. Traders and investors should stay vigilant and adapt their trading strategies to navigate the resistance and support levels effectively.
