The EUR/USD pair continued with its struggle to sustain/build on the momentum beyond the 1.1800 handle and finally lost some ground on Tuesday. A late pickup in the US Dollar demand, during the New-York trading session, was seen as one of the key factors exerting some downward pressure on the major. The pair, however, had a rather muted reaction to the latest US consumer inflation figures and the denuclearization deal signed by Trump and Kim in Singapore.
The pair traded in a sideways manner during the Asian session on Wednesday as market participants turned their focus to the outcome of a highly anticipated two-day FOMC policy meeting. The US central bank is scheduled to announce its decision later during in the day and is widely expected to hike interest rates. The key focus would on updated economic projection, especially the so-called 'dot-plot'. Any hints of more than 3 rate hikes already priced in the market should be positive for the greenback.
Meanwhile, investors are unlikely to place any aggressive bets and would prefer to wait on the sidelines ahead of Thursday's ECB decision, where the central bank is expected to outline its plan for eventually ending the massive bond purchase program.
From a technical perspective, the pair’s recent recovery from over 10-month lows stalled near 61.8% Fibonacci retracement level of the 1.1996-1.1510 recent downfall. Hence, it would be prudent to wait for a convincing break through the mentioned barrier before confirming that the pair might have bottomed out in the near-term.
Immediate resistance is pegged near the 1.1770 horizontal zone, above which the pair is likely to make a fresh attempt to clear the said hurdle near the 1.1800 handle. A follow-through momentum has the potential to continue lifting the pair even beyond 1.1840 intermediate towards reclaiming the 1.1900 round figure mark.
On the flip side, the 1.1720 level might continue to protect the immediate downside, which if broken might turn the pair vulnerable to slide back below the 1.1700 handle (38.2% Fibonacci retracement level) and head towards testing its next support near the 1.1655 region.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD drops below 1.0800 after German Retail Sales data
EUR/USD has come under fresh selling pressure and trades below 1.0800 after the data from Germany showed that Retail Sales declined by 1.9% MoM in February. Resurgent US Dollar demand is adding to the downside in the pair. US data are next in focus.
GBP/USD stays weak near 1.2600 amid market caution
GBP/USD remains defensive near 1.2600 in European trading on Thursday. The hawkish tone from Fed Governor Christopher Waller keeps the US Dollar afloat amid a cautious trading environment ahead of key US data releases and the Good Friday trading lull.
Gold price bulls keenly await US PCE Price Index on Friday before placing fresh bets
Gold price (XAU/USD) continues with its struggle to make it through the $2,200 mark on Thursday and oscillates in a narrow trading band through the early part of the European session.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.