EURUSD: Neutral
|EUR/USD: 1.0654
Euro reached the session high of 1.0713 in early European trade, since when it has remained under pressure, finishing the day just above the 1.0651 low, pulled down in part by the move lower in EurGbp when Cable headed higher on hope of a positive outcome on the UK Brexit vote. Also weighing on the Euro was the possibility of a good result for the far-right party in Wednesday’s Dutch election, although an outright win is not thought to be the likely outcome. With French/German elections coming up this year, a far-right show of strength would place further downside pressure on the Euro.
The short term momentum indicators are now looking as though the pressure today could remain on the downside although ahead of the FOMC outcome I doubt that we head too far in either direction and would be surprised to see the Euro head much below 1.0600, if indeed we get that far. If we do head lower then support will arrive at the minor Fibo levels of the rally from the 1.0494 trend low. If the Fed are overly hawkish in their growth outlook on Wednesday, we should see a return to dollar strength and, although some way off at present, a break of the recent 1.0525 pivot could retest the 1.0500/1.0490 area, beneath which there is not too much to hold the Euro up ahead of the 11 January low of 1.0453. Under there would suggest a run to much lower levels, with a return to the early January low of 1.0340 not being out of the question although that is currently a long way off. On the topside, back above 1.0700 would again see sellers at the session high of 1.0713, and then at 1.0750 although above that will find little resistance ahead of the early February high of 1.0829. Look for 1.0600/1.0700 to cover it today.
| 24 Hour: Neutral | Medium Term: Prefer to sell rallies | ||
| Resistance | Support | ||
| 1.0800 | Minor | 1.0652 | Session low /Daily cloud top |
| 1.0770 | Minor | 1.0630 | (38.2% of 1.0494/1.0713) |
| 1.0750 | (76.4% of 1.0829/1.0494) | 1.0605 | (50% of 1.0494/1 0713) |
| 1.0713 | 8 Feb high/Session high | 1.0578 | (61.8% of 1.0494/1.0713) |
| 1.0680 | Minor | 1.0525 | 9 Mar low |
Economic data highlights will include:
German CPI, HICP (Feb), EU Industrial Production (Jan), German/EU ZEW Economic Sentiment Survey (Mar) US NFIB Business Optimism Index, PPI, API Weekly Crude Oil Stock Inventory
Interested in EURUSD technicals? Check out the key levels
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