16.03.2023 02:42 PM
EUR/USD outlook for March 16, 2023

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In early February, EUR/USD reached a local 10-month high of 1.1032, but then fell sharply, primarily amid a strong dollar, losing about 4.0% in value from that mark to date.

And yet investors remain optimistic about the EUR/USD pair, including on expectations of a gradual narrowing of the interest rate gap between the Fed and the ECB. At the same time, there are fears that today's tough decision by the ECB to raise rates by 0.50% may have the opposite effect.

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In case of a breakdown of the key support levels 1.0540 (200 EMA on the daily chart), 1.0530 (144 EMA on the daily chart), 1.0500 (local "round" support level) and further decline, the pair will return to the global bear market zone.

Alternatively, if the bullish momentum develops and the pair moves to the February high at 1.1032, the first signal to increase the long positions may be a breakdown of the important resistance levels 1.0640 (200 EMA on the 1-hour chart), 1.0650 (50 EMA on the daily chart), 1.0661 (200 EMA on the 4-hour chart).

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The breakdown of the local resistance level 1.0760 (high of the month) will be a confirming signal.

The breakdown of key resistance levels 1.0980, 1.1090 will finally return EUR/USD to the long-term bull market zone.

Support levels: 1.0585, 1.0540, 1.0530, 1.0515, 1.0500, 1.0230

Resistance levels: 1.0640, 1.0650, 1.0661, 1.0700, 1.0760, 1.0800, 1.0930, 1.1000, 1.1032, 1.1090

Trading scenarios

Sell Stop 1.0570. Stop-Loss 1.0670. Take-Profit 1.0540, 1.0530, 1.0515, 1.0500, 1.0230

Buy Stop 1.0670. Stop-Loss 1.0570. Take-Profit 1.0700, 1.0760, 1.0800, 1.0930, 1.1000, 1.1032, 1.1090

Jurij Tolin,
Analytical expert of InstaForex
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