**Weekly Forex Analysis: Key Outlook for EUR/USD, GBP/USD, and USD/CAD**
*Based on analysis by Matías Salord, with additional insights from FXStreet and supplemental sources.*
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## Overview
The foreign exchange (forex) market remains a focal point for traders and investors, with significant attention given to major dollar pairs like EUR/USD, GBP/USD, and USD/CAD. This week’s analysis covers the current market sentiment, major technical levels, recent price action, economic drivers, and anticipated movements for these crucial pairs. The market environment is influenced by ongoing central bank commentary, shifts in risk appetite, and macroeconomic reports. A data-driven approach and close observation of price action remain imperative as we approach mid-year 2024.
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## EUR/USD: Consolidation and Uncertainty Prevail
### Current Sentiment
– The EUR/USD pair remains in a consolidation phase after a moderate selloff in previous sessions, mainly driven by speculation around European Central Bank (ECB) policy and US Federal Reserve expectations.
– Recent commentary from ECB officials has reinforced the possibility of further rate cuts, even as inflation data presents a mixed picture.
– US economic indicators continue to present a more robust outlook, especially after positive labor market and growth figures, lending ongoing support to the dollar.
### Technical Analysis
– **Support Level**: The first significant support is located at the 1.0670-1.0680 area. This zone has acted as a floor recently and is reinforced by previous swing lows.
– **Resistance Level**: Immediate resistance lies near 1.0770, a level that has capped several recent attempts at a bullish breakout.
– Should the pair move above 1.0800, it could gather upside momentum, targeting the next resistance zone at 1.0850.
**Key Technical Observations:**
– The daily chart is marked by a sideways pattern, indicating indecision among traders as fundamental catalysts remain ambiguous.
– Moving averages (50-day and 200-day SMAs) are converging, reflecting the range-bound behavior.
– RSI (Relative Strength Index) remains close to neutral at 50, echoing the ongoing consolidation.
### Economic Drivers
– **Eurozone:** Persistent concerns regarding stagnant growth and lackluster inflation data continue to cloud the euro’s outlook. Rising energy prices could pressure European consumers, and business sentiment surveys suggest limited upside for the region’s economy.
– **US:** Stronger than expected payroll figures and persistent inflation above the Fed’s long-term target have prompted speculation the Fed will “wait and see” before contemplating rate cuts. Market participants are seeking clarity from upcoming CPI releases and FOMC meeting minutes.
### Outlook and Trade Ideas
– If EUR/USD breaks beneath 1.0670, the next target would be the May lows near 1.0600.
– On a move above 1.0800, short-term technicals could support a rally toward 1.0850 or even 1
Read more on AUD/USD trading.