- The pair alternates ups & downs near 1.1260.
- The greenback gyrates around the 97.00 handle.
- ECB meeting, FOMC minutes next of relevance today.
EUR/USD is now attempting some consolidation in the top of the weekly range near 1.1260 ahead of key events later today.
EUR/USD focused on ECB, FOMC
Tuesday’s up move to multi-day highs in the 1.1280 region lacked of follow through, receding to the 1.1260 region and sparking at the same time some consolidation among investors.
In the meantime, the cautious stance has resurfaced in the markets following President Trump’s threats of imposing further tariffs on EU products, including the key autos sector. Adding to the broad-based concerns over global growth, the IMF once again revised lower its outlook and now sees the world economy expanding at an annualized 3.3% this year, down from 3.5%.
Later in the day, the ECB meeting will be the salient event in Euroland, where expectations are tilted towards a somewhat dovish message from the central bank, while traders will look for extra details on the implementation of TLTROs and a probable tiered deposit rate system.
What to look for around EUR
EUR remains under pressure following poor fundamentals in Euroland and the strong up move in the greenback in past weeks. In fact, recent disappointing readings in the region somehow confirm that the slowdown in the bloc and the ‘patient-for-longer’ stance from the ECB could be among us for longer than expected. Against the backdrop of souring risk-appetite trend, the greenback should emerge stronger and is expected to keep weighing on spot for the time being. On the political front, headwinds are expected to emerge in light of the upcoming EU parliamentary elections, where the focus of attention will be on the potential increase of the populist option among voters.
EUR/USD levels to watch
At the moment, the pair is gaining 0.01% at 1.1262 and a breakout of 1.1284 (high Apr.9) would target 1.1318 (55-day SMA) en route to 1.1337 (200-week SMA). On the downside, immediate support emerges at 1.1230 (10-day SMA) seconded by 1.1183 (low Apr.2) and finally 1.1176 (low Mar.7).
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