Will the euro-dollar pair, which is facing resistance at higher levels, extend its decline? All eyes are on the outcome of the FOMC meeting.
26.07.2023
- U.S. FOMC Policy Rate and Statement Release
- U.S. New Home Sales
In the previous day’s U.S. currency trading, the U.S. dollar strengthened against the euro after the Conference Board’s July Consumer Confidence Index, released during U.S. trading hours, rose to 117.0 from the previous reading of 109.7.The EUR/USD pair fell from 1.1086 to 1.1020. The 20-period moving average (MA) on the hourly chart acted as resistance, and the downtrend continued. However, on the higher timeframe (4-hour chart), support from the 200-period exponential moving average (EMA) and simple moving average (SMA) exists just below the current price. Therefore, we need to carefully assess whether the pair will break below these support levels as we move into U.S. trading hours.
Among European currencies, the pound saw a seesawing trend against the yen. GBP/JPY fluctuated between 181.147 and 182.008, trading straddling the 20-period moving average on the hourly chart and lacking a clear direction.During today’s Asian session, although the pair is trading above the hourly 20-period moving average, it remains range-bound within a 20-pip range. Until the FOMC meeting concludes, it seems prudent to adopt a wait-and-see stance regarding the direction of the yen crosses.
Today, the Japanese Leading Economic Index is scheduled for 2:00 PM, Sweden’s trade balance at 3:00 PM, France’s consumer confidence index at 3:45 PM, Switzerland’s investor confidence index at 5:00 PM, the U.S. MBA mortgage applications index at 8:00 PM, U.S. new home sales at 11:00 PM, and U.S. weekly crude oil inventories at 11:30 PM.at 3:00 AM, the U.S. FOMC interest rate decision and statement, and at 3:30 AM, a press conference by Fed Chair Powell. With the EUR/USD pair facing resistance on the upside, we will be watching closely to see if it extends its decline following the FOMC announcement.
Author: Keisuke Sakurai
