The EURUSD is continuing lower. German IFO weaker. Fed the first central bank this week.

The EURUSD is continuing lower today. Overnight, the Ifo Business Climate Index for Germany in July 2023 came in at 87.3, lower than the expected 88.0 and also lower than the prior figure of 88.6 (revised from 88.5). That helped the downside momentum modestly

The Fed is the first central bank to meet this week. They are largely expected to raise rates by 25 basis points tomorrow to 5.5%. What the Fed says about policy going forward will be key. On Thursday, the ECB meets and they too are expected to raise rates by 25 basis points to 4.25%. Most ECB officials have also talked about having the September meeting data-dependent.

Looking at the 4-hour chart, the price of the EURUSD fell below the 50% midpoint of the move up from the July 6 low (range for the month). That level comes in at 1.10539. The current price is trading at 1.1045 after reaching a swing low today of 1.10386. The prices also moved below its 100 bar moving average of the 4-hour chart at 110617. That moving average is now close risk (see below line in the chart above). Stay below keeps the sellers more in control.

On the downside, the swing high from June 23 came in at 1.10102. A swing high on July 11 comes at 1.10267. The area (see red numbered circles in the chart above) between those 2 levels along with the 61.8% retracement of the same move higher at 1.10017 are the next downside target to get to and through. Below that the rising 200 bar moving average comes in at 1.10707 (that is between a swing area between 1.09618 and 1.09759).

Sellers are more control below the 50% retracement and the 100 bar moving average on the 4 hour chart.

This article was written by Greg Michalowski at Source