- The EUR/USD pair maintains a bearish bias despite the current rebound.
- A new lower low activates a downside continuation.
- The FOMC could really shake the markets tomorrow.
The EUR/USD price turned to the downside after reaching 1.0050. At the time of writing, the price is trading above today’s low of 1.0002.
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Fundamentally, the German PPI rose by 7.9% versus 2.5% expected and compared to 5.3% growth in the previous reporting period, while the Current Account was reported at -19.9 points below 5.3B estimates.
Later, the US will release its Building Permits and the Housing Starts. The economic data could bring more action. Better than expected, US data could lift the greenback. Also, the Canadian inflation data could move the markets today. You need to be careful, as the fundamentals could change the sentiment.
As you already know, the USD maintains a bullish bias despite temporary declines. Tomorrow, the FOMC represents the most important event of the week. The FED is expected to increase the Federal Funds Rate from 2.50% to 3.25%. The FOMC Economic Projections, FOMC Statement, and the FOMC Press Conference could really shake the markets.
Dollar Index price technical analysis: Rangebound behavior
Technically, the DXY returned to test the 109.29 – 109.47 zone before turning to the upside again. In the short term, the index could continue to move sideways before the FOMC.
The bias remains bullish. Further growth should force the USD to appreciate versus its rivals. After its strong rally, the current accumulation was natural. A new higher high activates further growth. The 109.97 and the 110.26 represent near-term resistance levels.
EUR/USD Price Technical Analysis: Wobbling above parity
As you can see from the hourly chart, the price failed to reach the weekly pivot point of 1.0050. Now, it challenges the parity again. It remains to see how it will react after failing to stabilize above the 1.0023 static resistance.
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The price escaped from the range pattern signaling a potential further growth, but the downside pressure remains high. Still, only a new lower low, dropping and closing below 0.9952, could activate a downside continuation. On the other hand, a new higher high may activate further growth.
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