EUR/USD under pressure as US dollar soars, tests 1.2000


  • US dollar jumps after the FOMC meeting as officials bring forward rate hike expectations.
  • EUR/USD heads for lowest daily close since early May.

The EUR/USD dropped further and reached a fresh monthly low at 1.2007 during Fed’s Powell press conference. The pair dropped sharply following the FOMC meeting and continued to slide amid a rally of the US dollar.

The greenback rose sharply amid higher US yields. The 10-year yield jumped to 1.59% before pulling back to 1.56% (still up more than 4% for the day). At the same, equity prices dropped further in Wall Street.

The FOMC projections triggered the move. The Federal Reserve, as expected kept interest rates and the QE program unchanged. The economic projections of FOMC members now see higher inflation ahead, and also more members expect a rate hike in 2023, compared to the March report.

“Fed policymakers likely will signal in late summer or early August that tapering is nearing. Long-term interest rates likely will grind higher as market expectations of tapering ramp up”, say analysts at Wells Fargo. The minutes of the June meeting will be released on July 7.

EUR/USD approaches key support: 1.1990

The EUR/USD found support so far above the 1.2000 area. The rebound so far has been limited quickly by the 1.2035 area, showing that the bearish pressure still persists. The key support to consider ahead is 1.1990, a horizontal level and also the 200-day moving average.

Price is back under the 55-day moving average, and the technical outlook now favors the downside. A recovery above 1.2200 would negate the bearish bias.

Technical levels

EUR/USD

Overview
Today last price 1.2022
Today Daily Change -0.0105
Today Daily Change % -0.87
Today daily open 1.2127
 
Trends
Daily SMA20 1.2185
Daily SMA50 1.2095
Daily SMA100 1.2042
Daily SMA200 1.1994
 
Levels
Previous Daily High 1.2147
Previous Daily Low 1.2101
Previous Weekly High 1.2218
Previous Weekly Low 1.2093
Previous Monthly High 1.2266
Previous Monthly Low 1.1986
Daily Fibonacci 38.2% 1.213
Daily Fibonacci 61.8% 1.2119
Daily Pivot Point S1 1.2103
Daily Pivot Point S2 1.2079
Daily Pivot Point S3 1.2057
Daily Pivot Point R1 1.2149
Daily Pivot Point R2 1.2171
Daily Pivot Point R3 1.2195

 

 

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