EUR/USD Forecast – Euro Waits for The FOMC

Euro vs US Dollar Technical Analysis

The Euro initially pulled back just a bit during the early hours on Wednesday, but it’s worth noting that the Euro is going to have to deal with the FOMC later. The FOMC interest rate decision, press conference and monetary statement obviously will have a major influence on the US dollar. During the previous session, it looks as if traders had sold off perhaps in anticipation of the Federal Reserve being more hawkish than dovish. Now we have a situation where traders will continue to go back and forth until we get some type of clarity out of the Federal Reserve.

If we do rally from here, the 50-day EMA sitting just below the 1.0775 level will be resistance. Underneath, the 1.06 level will be support. In general, I think we probably go back and forth quite a bit during the day, but whether or not anything changes remains to be seen. After all, if the Federal Reserve sticks to the same statement that it’s had for a while, then not much will change. We will just hang around trying to sort out what to do next.

This is a market that I think is going to be very sideways for most of the year anyway, so we will have to see how that plays out. If we do break above the 50 day EMA, we could go looking to the 1.09 level. If we break down below the 1.06 level, then 1.05 could be a target. Right now, I think we are essentially just caught in this barely tight consolidation range. At this point, do not be surprised if the range holds, as this pair is known to do that often.

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