EUR/USD Analysis:
- FOMC[1] Minutes dominate event risk as traders seek clarity on the Fed’s June 16 ‘hawkish surprise’
- Key technical levels to consider ahead of the minutes as bearish momentum wanes
- IG client sentiment[2] remains net long hinting at bearish continuation
EUR/USD Seeks Directional Clues from FOMC Minutes
The EUR/USD[3] pair (at the time of writing) reveals a doji[4] candle during the London session as we head into the US open. The doji candle can be reflective of indecision in a market and right now appears to reveal a ‘wait and see’ approach to the FOMC minutes to be released later today.
Yesterday’s sharp move lower in the pair had market commentators joke about the FOMC minutes being released ahead of schedule. Treasury yields, the Dow Jones[5] and S&P 500[6] dropped lower while the US dollar[7] gained against its peers in a move consistent with a sudden ‘risk off’ narrative.
Market participants should receive clarity around the accelerated time frame of anticipated rate hikes in the US when the minutes are released later today.
For all market-moving data releases and events see the DailyFX Economic Calendar[8]
Key Technical Levels to Watch for EUR/USD
The weekly chart frames price action from a long term point of view allowing greater insights into long term trends and developments. After posting a high at the start of the year, EUR/USD[9] had been rather choppy, trading above and below the significant 1.2000 level.
However, price action currently rests on the 61.8% Fibonacci level (drawn from the 2018 high to 2020 low) with the ascending trendline in reach.
Chart prepared
