- The dollar gains momentum and tries to stabilize.
- The euro the worst performer among the G10.
- EUR/USD remains in a recent range, with a negative intraday bias.
- Inflation data is coming from Germany and GDP from the US.
The EUR/USD broke below 1.0180 and fell to levels below 1.0150. In this way he gave up much of the gains that followed the Fed meeting, in the face of a dollar that seeks to stabilize and a weaker euro.
The common European currency is trading at daily lows also counting the pound and the Swiss franc. In turn, currencies linked to commodities rise against the dollar.
EUR/USD is still within the recent range. A confirmation below 1.0100 (intermediate resistance at 1.0120) could point to an acceleration to the downside. On the other hand, a rally above 1.0250 would give the Euro significant support to extend gains.
After the Fed, the data
The Federal Reserve raised the interest rate by 75 basis points on Wednesday. Jerome Powell indicated that the next steps will depend on the data. The market interpreted that there could be a slowdown in the rate of rises, which caused the dollar to retreat.
EUR/USD reached a high hours ago at 1.0234. It then lost sharply and recently broke below 1.0190 accelerating down to 1.0148, the new daily low. The dollar was recovering positions throughout the market.
The focus now goes to economic data. A drop in July’s confidence surveys was known in the Eurozone, higher than expected. At 12:00 GMT the Germany’s preliminary July inflation report.
Then it will be the turn of the US economic figures with the first second quarter GDP growth reading. The weekly report on unemployment subsidy requests will also be released. The GDP is expected to show a slight rise, but there are also analysts who estimate that it will show a contraction.
After the Fed meeting, the focus returns to the data and the GDP data could be key and have a great impact throughout the market.
Technical levels
Source: Fx Street
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