- The markets eye on the Federal Reserve.
- The dollar loses strength after US economic data.
- EUR / USD without clear direction, manages to hold above 1.2100.
The EUR / USD bounced higher and erased losses on the day. The price had fallen to 1.2099 and after the start of the American session it rose approaching 1.2130, moving to positive territory. The dollar lost steam after the release of US economic data.
With eyes on the Fed
US economic data did not generate major surprises. There was a drop in retail sales greater than expected, although with upward revisions from the previous month. Wholesale inflation in April rose more than expected and industrial production expanded, exceeding expectations.
On Wednesday the decision of the Federal Reserve will be known, which is not expected to announce changes, but the eye will be on the clues to the future and the possibility that there will be changes soon in the purchase program, with the consequent impact on the bond market.
The 10-year rate was above 1.50% and fell below in the last hour, making the dollar stronger. On Wall Street, stocks are falling modestly. The Dow Jones gives 0.35% and the Nasdaq 0.31%.
From a technical point of view, the EUR / USD avoided for now the definitive break of 1.2100, although it still continues with some downward pressure. A consolidation below would leave the euro set for lower and a possible test at 1.2000. In the opposite direction, clear resistance is at the 1.2200 area, which is not just a round number, but also horizontal resistance and the current buffer of the 20-day average, which is why a comeback above, I would deny any short-term bearish bias.
Technical levels
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