FXStreet (Córdoba) – EUR/USD remained calm during the American session despite the decline of the US dollar across the board amid risk appetite and ahead of the FOMC statement.
EUR/USD flat
The pair rose during the Asian session to 1.0874 but after finding resistance at the 20-day moving average reversed and dropped to 1.0816. From there it rebounded.
During most of the American session, it moved in a small range between 1.0860 and 1.0835, where is about to end the day, practically around the same level it closed yesterday.
The bounced from the lows was helped by US economic data that showed that the services PMI expanded at the slowest pace since December 2014 (53.7 versus expectations of 54.0) and the Richmond Fed Manufacturing index dropped to 2 (versus 3). Stocks in Wall Street are consolidating important gains after a sharp reversal.
EUR/USD technical outlook
Valeria Bednarik, Chief Analyst at FXStreet affirms that the pair presents a neutral technical tone ahead of the FOMC’s economic policy decision this Wednesday. “As for the technical picture, the 4 hours chart shows that the price briefly fell below its 20 SMA, but is now holding above it, while the technical indicators head nowhere around their mid-lines, reflecting the ongoing market’s uncertainty over the pair”.
Bednarik explained that the key area to watch is the 1.0770/1.0800 region, “where the pair met buying interest even since the year started, and even has the 50% retracement of the December rally. A break below the level should open doors for a steady decline towards the 1.0715 region, the 61.8% retracement of the same rally.”
(Market News Provided by FXstreet)