EUR/USD under pressure as traders await FOMC decision

The Euro remains on the defensive against the US Dollar as market participants await March’s monetary policy decision by the Federal Open Market Committee (FOMC) on Wednesday. Therefore, the EUR/USD trades at 1.0859 and loses 0.12%.

EUR/USD dips amid central bank movement, positive US housing data

Tuesday’s session witnessed two major central banks' decisions. The Bank of Japan (BOJ) exited from negative interest rates, though delivered a dovish hike, which weakened the Japanese Yen (JPY) against most G8 currencies. The Reserve Bank of Australia (RBA) holds rates unchanged at 4.35%, with the RBA still considering a rate hike if inflation reaccelerates.

Aside from this, Wall Street prints decent gains as global bond yields drop. The US economic docket showed the housing sector is gathering steam. US Building Permits in February grew 1.9%, MoM, up from 1.489 million to 1.496 million. At the same time, Housing Starts for the same period exceeded estimates of 8.2%, increasing by 10.7%.

In the meantime, the US 10-year Treasury bond yield retreats two basis points, down to 4.034%. The US Dollar Index (DXY), a gauge of the buck’s value against a basket of other currencies, gains 0.23%, up at 103.82.

On the Eurozone’s (EU) front, Germany published the March ZEW Survey, which improved the country to 31.7, while the EU one surged to 33.5, beating estimates.

EUR/USD Price Analysis: Technical outlook

The EUR/USD daily chart suggests the pair is neutral to downward biased, though dynamic support levels like the 200, 100, and 50-day moving averages (DMAs) capped the Euro’s losses, opening the door for a recovery. If buyers lift the exchange rate above 1.0900, it could expose the March 13 high at 1.0964. followed by the year-to-date (YTD) high at 1.0981. On the other hand, sellers need to push prices below the 200-DMA at 1.0838, so they could threaten to challenge 1.0800.