In the European session, EURUSD saw a downward trend, notably breaking below its 100-day moving average (MA) at 1.0857. The decline continued until the currency pair reached and tested significant support levels—the 200-day MA and the 50% midpoint of its rise from the February low, both situated at 1.08374. Today’s low went just below this level, touching 1.0359. This movement echoed the previous day’s activity, where the price similarly tested these levels, briefly dipped below, and subsequently recovered.
Following this dip, the EURUSD managed to rebound, climbing back up towards the 100-day MA at 1.08573. Upon reaching this level, the price encountered resistance, a response anticipated by technical analysis. This resistance occurs at a critical moment, with the FOMC rate decision on the horizon. The dynamic between these two daily MAs delineates the bullish and bearish targets, setting the stage for the market’s next moves.
Should the price advance above the 100-day MA, attention will shift towards the 1.08656 swing area and then to the 100-hour MA at 1.08738. A successful break above this threshold could see the EURUSD aiming for the 1.0900 mark and the descending 200-hour MA at 1.09042. On the flip side, a fall below the 200-day MA and the 50% midpoint at 1.08374 could lead to a further slide towards the 61.8% retracement at 1.08036 and potentially to swing lows near 1.07955.
As the market braces for the Federal Reserve’s upcoming decision, investors are keenly watching for signs of the central bank’s stance. The Fed’s announcement, along with the dot plot, central tendencies, and Chair Powell’s press conference at 2:30 PM ET, will significantly influence market sentiment and the EURUSD’s direction.
This article was written by Greg Michalowski at www.forexlive.com. Source