- EUR/USD is trading a bit higher within the narrow ranges.
- All eyes are on Fed Chair Jerome Powell's testimony.
- The double-top at 1.1372 is the key to the upside.
EUR/USD is trading around 1.1350, in a slightly higher range than on Monday. Markets are focused on the upcoming testimony by Fed Chair Jerome Powell due at 14:45 GMT.
The world's most powerful central banker is expected to reiterate the message of patience regarding interest rates, as stated in January's decision. He will provide an overview of the US economy, the upbeat state of employment, somewhat subdued inflation, and slowing growth.
Markets will want to know if the FOMC is done with rate hikes this year or if the door is still open. In addition, any comments on the balance sheet reduction program will be of interest. The initial reaction will be to the prepared remarks that are released at 14:45 GMT, and he will then read it out and face questions from lawmakers in a lengthy session.
See: 3 Currencies to Buy on Fed Powell's Testimony
US President Donald Trump continued expressing optimism about trade talks with China. He may meet his Chinese counterpart Xi Jinping for what is touted as a "signing ceremony" in late March. Markets reacted positively to the news early in the week, but are now more muted.
In addition, quite a few figures are due in the US, starting with housing starts and building permits, continuing with the updates on house prices, and culminating in the CB Consumer Confidence. Despite the importance, Powell's testimony will likely overshadow all the data.
In the old continent, there have been no major economic releases. Nevertheless, European leaders have been busy telling UK PM Theresa May to delay Brexit, which is only 31 days away. She will reportedly bow to this peer pressure and also to demands from the pro-Remain camp, announcing a postponement. The pound jumped on the news while the euro ticked up just a bit.
Brexit developments may have a greater say in EUR/USD movements today, but they will compete with Powell.
EUR/USD Technical Analysis
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EUR/USD faces critical resistance at 1.1372. This price was the high point last week and also earlier in the day. Moreover, it nearly perfectly coincides with the 200 Simple Moving Average on the four-hour chart.
So, 1.1372 is a make or break line for the pair.
Further up, 1.1390 and 1.1405 worked as support lines in late January and now switch to resistance. .1.1430 was a swing low in early February and 1.1450 capped EUR/USD around the same time.
Immediate support awaits at 1.1345 that was a low point earlier in the day. 1.1330 was a cushion earlier this week and it is followed by 1.1315 and 1.1295 which were swing lows last week.
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