Currently, EUR/USD is trading at 1.1974, up 0.16% on the day, having posted a daily high at 1.2007 and low at 1.1950.
After being the best performer on Monday, EUR/USD opened Asia 0.30% higher and went on to score a few pips into the 1.20 handle in thin trade (1.2006 high), the highest level since 10th September.
The euro's strength was more about flows in European and US trade, (sparked by Yen weakness, EUR/JPY to fresh 21-year highs, 134.17). However, the EZ news and data were both supportive of the euro before profit taking and the handover into this subdued New York session, (second tier US data and Trump's address to the U.N. not sparking any price action - market awaiting FOMC outcome).
Germany's September ZEW current situation arrived at 87.9 vs 86.2 exp. Eurozone July current account SA arrived as EUR 25.1bln vs 22.8bln previous and Eurozone July construction output mm was 0.2% matching the previous.
EUR/USD was sliding back to 1.1954 London lows and has settled into a consolidation phase in the US session around 1.1970, underpinned in a higher range ahead of Wednesday’s FOMC meeting.
German elections on Sunday
In respect of this weekend's elections in Germany, where Merkel goes for a 4th term after a twelve-year leadership the euro was even unfazed by the latest election poll from Forsa that sees Merkel & Co now down to 36% ( -1% on the week) and placing the SPD unchanged at 23%.
An unlikely scenario, but should Merkel be short of a parliamentary majority in the Bundestag she will need weeks, if not months, to form a new coalition government and the euro could come under pressure in such a scenario. However, while Merkel is fully expected to become the President again, investors remain vigilant to geopolitical events and are not committing themselves to any certainties at this stage.
FOMC forecasts
- US: Focus on Sep FOMC meeting - Westpac
- FOMC Preview: there's nothing the Fed can do to save the greenback
In respect of techncials, as we await the FOMC, Valeria Bednarik, chief analyst at FXStreet explained that EUR/USD is overall maintaining the bullish long-term stance, as in the daily chart, the price remains well above an ascendant trend line coming from early April, currently around 1.1820, whilst the price remains far above bullish 100 and 200 SMAs, and around the 20 SMA, which losses upward strength.
Valeria Bednarik's full technical analysis of EUR/USD:
"Technical indicators in the same chart hold within positive territory but lack directional strength. The pair has an immediate resistance in the 1.2030/60 region, with gains beyond the level exposing firstly the 1.2101 level, January 2015 high. Beyond it, the rally can extend short-term towards 1.2140/60, while a daily close above 1.2100 will open doors for an extension towards 1.2300 in the following days. 1.1910 is the immediate support, ahead of the critical 1.1820, where the pair has the mentioned trend line and a relevant weekly low from August. Further slides below this level will leave the pair poised for a deeper downward corrective movement, down to August 17th low at 1.1661."
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
AUD/USD: Further losses retarget the 200-day SMA
Further gains in the greenback and a bearish performance of the commodity complex bolstered the continuation of the selling pressure in AUD/USD, which this time revisited three-day lows near 0.6560.
EUR/USD: Further weakness remains on the cards
EUR/USD added to Tuesday’s pullback and retested the 1.0730 region on the back of the persistent recovery in the Greenback, always against the backdrop of the resurgence of the Fed-ECB monetary policy divergence.
Gold flirts with $2,320 as USD demand losses steam
Gold struggles to make a decisive move in either direction and moves sideways in a narrow channel above $2,300. The benchmark 10-year US Treasury bond yield clings to modest gains near 4.5% and limits XAU/USD's upside.
Bitcoin price dips to $61K range, encourages buying spree among BTC fish, dolphins and sharks
Bitcoin (BTC) price is chopping downwards on the one-day time frame, while the outlook seen in the one-week period is a horizontal trade. In this shakeout moment, data shows that large holders are using the correction to buy up BTC.
Navigating the future of precious metals
In a recent episode of the Vancouver Resource Investment Conference podcast, hosted by Jesse Day, guests Stefan Gleason and JP Cortez shared their expert analysis on the dynamics of the gold and silver markets and discussed legislative efforts to promote these metals as sound money in the United States.