EUR/USD Current Price: 1.2124
- US data came in mixed, with Retail Sales down by 1.3% MoM in May.
- The Fed will announce its monetary policy and present fresh economic projections.
- EUR/USD is at risk of falling as long as it trades below 1.2145.
The EUR/USD pair is ending Tuesday unchanged on a daily basis in the 1.2120 price zone. The greenback strengthened against most of its major rivals as the US Federal Reserve decision on monetary policy looms. Stocks traded with a mixed tone, with most European indexes posting gains but US ones edging lower.
Germany published the final version of its May inflation readings. The annual Consumer Price Index was confirmed at 2.4%, as previously estimated. The EU published the April Trade Balance, which posted a seasonally adjusted surplus of €9.4 billion. In the US, May Retail Sales were down 1.3% MoM, worse than anticipated, while the Producer Price Index in the same month jumped to 6.6% YoY, another sign of mounting inflationary pressures.
The US will publish on Wednesday housing-related data, although the main focus will be the US Federal Reserve. The central bank will announce its latest decision on monetary policy but also present fresh economic projections. Despite rising inflation, it seems unlikely policymakers will take action this time. However, policymakers may offer a more hawkish stance given the economic comeback and hint on future tapering.
EUR/USD short-term technical outlook
The EUR/USD pair is trading around 1.2120, maintaining its bearish tone in the near-term. The 4-hour chart shows that it is developing below a bearish 20 SMA, which heads south below the longer ones. Technical indicators remain within negative levels, with the Momentum advancing but the RSI flat at around 44. The pair could recover its bullish potential once above 1.2145, while bears may give it another try once below the monthly low at 1.2092.
Support levels: 1.2090 1.2050 1.2010
Resistance levels: 1.2145 1.2190 1.2230
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