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After falling below parity on September 19, 2022 and accelerating downward to 0.9543, the Eur/Usd exchange rate has shown first signs of reaction, currently favoring a recovery of 4.34 percent from the lows recorded on September 28, 2022.
The current medium/long-term trend is still in a downward phase, with quotations within a descending channel (valid since the highs of February 2022). However, on the day of October 25, the exchange rate pierced the upper wall of the channel described above to the upside, sending decisive signals that we could see a potential price recovery.
In fact, analyzing the daily chart, it is possible to observe how prices have risen above the descending red line, which identifies a first target projection toward 1.0350 (100 percent Fibonacci expansion).
Another short-term bullish factor, is the imminent upward crossing of the 21-day exponential moving average over the 50-day simple moving average. In addition, the obvious positive divergence of the MACD indicator (rising relative to falling prices) suggests a slowing of the medium-term decline, sending a definite wake-up call.
Clearly, a recovering euro against the U.S. dollar may favor a lower cost of commodities in € (in the event of a decline in $ prices) while in the event of a rise in commodities quoted in $ prices in € may be more advantageous.