Technical analysis on EUR/USD on October 31, 2023


Overview :

A trend in the EUR/USD pair was argumentative as it was trading in a narrow sideways channel, the market showed signs of instability. Amid the previous events, the price is still moving between the levels of 1.0600 and 1.0780. Resistance and support are seen at the levels of 1.0780 (also, the double top is already set at the point of 1.0780) and 1.0636 respectively.

Therefore, it is recommended to be cautious while placing orders in this area. So, we need to wait until the sideways channel has completed. The current price is seen at 1.0691 which represents a key level today. The level of 1.0725 will act as the first resistance today.

Consequently, there is a possibility that the EUR/USD pair will move downside. The structure of a fall does not look corrective. In order to indicate a bearish opportunity below the spot of 1.0725 – 1.0748, The level of 1.0725 coincides with 61.8% of Fibonacci, which is expected to act as a major resistance today.

Since the trend is below the 61.8% Fibonacci level, the market is still in a downtrend. Overall, we still prefer the bearish scenario. Hence, if the pair fails to pass through the level of 1.0725, the market will indicate a bearish opportunity below the strong resistance level of 1.0725.

Sell deals are recommended below the level of 1.0725 with the first target at 1.0670. If the trend breaks the support level of 1.0670, the pair is likely to move downwards continuing the development of a bearish trend to the level 1.0636 so as to test the double bottom at the hourly chart. The market is still in an downtrend.

We still prefer the bearish scenario. In case a reversal takes place and the EUR/USD pair breaks through the support level of 1.0636, a further decline to 1.0603 can occur, which would indicate a bearish market. Overall, we still prefer the bearish scenario, which suggests that the pair will stay below the zone of 1.0725 today.