• EUR/USD adds to Monday’s gains north of the 1.0200 mark.
  • The dollar remains offered in the first half of the week.
  • Further prudence is likely ahead of US CPI (Wednesday).

The buying pressure around the European currency remains well and sound and now lifts EUR/USD to 2-day highs above 1.0220 on Tuesday.

EUR/USD bid on USD-selling

EUR/USD advances for the second session in a row and extends the optimism seen at the beginning of the week, as the greenback continues to give away its post-NFP gains on Tuesday.

The pair’s recovery, however, stays so far within the broader 1.0100-1.0300 consolidative range that has been in place since mid-July, always against the backdrop of recession talk on both sides of the Atlantic as well as speculations over the next steps regarding an interest rate hike by both the Fed and the ECB.

Nothing scheduled data wise in Euroland on Tuesday, whereas minor releases are expected across the pond, namely, the NFIB Business Optimism Index and the IBD/TIPP Economic Optimism Index.

What to look for around EUR

EUR/USD so far keeps the 1.0100-1.0300 range unchanged against the backdrop alternating risk appetite trends.

Price action around the European currency, in the meantime, is expected to closely follow dollar dynamics, geopolitical concerns, fragmentation worries and the Fed-ECB divergence.

On the negatives for the single currency emerges the so far increasing speculation of a potential recession in the region, which looks propped up by dwindling sentiment gauges and the incipient slowdown in some fundamentals.

Key events in the euro area this week: Germany Final Inflation Rate (Wednesday) – EMU Industrial Production (Friday).

Eminent issues on the back boiler: Continuation of the ECB hiking cycle. Italian elections in late September. Fragmentation risks amidst the ECB’s normalization of monetary conditions. Impact of the war in Ukraine on the region’s growth prospects and inflation.

EUR/USD levels to watch

So far, spot is gaining 0.47% at 1.0238 and faces the next up barrier at 1.0293 (monthly high August 2) seconded by 1.0385 (55-day SMA) and finally 1.0615 (weekly high June 27). On the flip side, a break below 1.0096 (weekly low July 26) would target 1.0000 (psychological level) en route to 0.9952 (2022 low July 14).

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

AUD/USD regained 0.6500 and aims to extend its advance

AUD/USD regained 0.6500 and aims to extend its advance

The AUD/USD pair trades around 0.6520, as the better tone of equities and profit-taking due to extreme overbought conditions took its toll on the greenback. Positive momentum is set to continue, at least in the near term.

AUD/USD News

EUR/USD flirts with 0.9750 amid a dollar sell-off

EUR/USD flirts with 0.9750 amid a dollar sell-off

The EUR/USD pair soared in the latest American session after reaching a fresh 22-year low of 0.9535. The greenback entered a selling spiral after Wall Street changed course while government bond yields sunk.

EUR/USD News

Gold: Sharp bounce falling short of indicating a trend change

Gold: Sharp bounce falling short of indicating a trend change

XAUUSD bounced from a fresh two-year low of $1,614.81 a troy ounce as dip buyers appeared on the dollar’s extreme overbought conditions. The bright metal peaked at $1,661.57, its highest for the week, holding above the $1,650 mid-US afternoon.

Gold News

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Whale Watching 102 - Don't become the bait

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: Whale Watching 102 - Don't become the bait

Statistically, October and November are usually bullish months for crypto. There is nothing wrong with casting a rod in treacherous water, but risk management should be applied. Don't become the bait when fishing for gains.

Read more

TIPS – A misunderstood inflation hedge

TIPS – A misunderstood inflation hedge

With inflation high and volatile, and with uncertainty about how quickly inflation might return to pre-Covid levels, should investors consider Treasury Inflation Protected Securities (“TIPS”) as part of a conservative portfolio allocation or for portfolio diversification? To answer the question, it is helpful to understand what TIPS are and how they work in practice.

Read more

Forex MAJORS

Cryptocurrencies

Signatures