EUR/USD trims gains and recedes to 1.1440 ahead of FOMC
- Spot comes under some selling pressure and abandon daily highs.
- The recovery in the greenback falters around 95.90.
- FOMC minutes are expected later in the NA session.
After advancing to the 1.1480 region in early trade, sellers turned up and motivated EUR/USD to ease to the 1.1440 region.
EUR/USD stays sidelined, looks to FOMC
Another day, another failed attempt to surpass the 100-day SMA in the 1.1480 region. The pair keeps the sideline theme unchanged so far today, all within the broader 1.12/1.15 range that has been in place since November 2018.
Data wise in Euroland, the unemployment rate ticked lower to 7.9% during November, the lowest level in a decade, pointing out to further tightening of the labour market in the region.
Later in the European evening, the FOMC will publish its minutes of the December meeting, when it raised rates by another 25 bps.
What to look for around EUR/USD
In the very near term, US-China trade negotiations will remain key for the price action in the risk-associated complex. On the USD-side, today’s FOMC minutes could shed more detail on the views of the Committee regarding the rate path for the next months as well as the sustainability of the current pace of the US economy. Other than USD-dynamics, EUR faces difficulties in its own backyard which could hinder further upside: political effervescence in Italy, upcoming discussions over the French budget along with some social unrest, German economy could enter a technical recession in Q4 in light of recent poor data releases, declining investor confidence in the euro bloc… and as a result of this mix, the ECB could remain sitting on the fence for longer…
EUR/USD levels to watch
At the moment, the pair is gaining 0.11% at 1.1453 facing the next hurdle at 1.1476 (100-day SMA) seconded by 1.1485 (high Jan.7) and finally 1.1497 (high Jan.2). On the flip side, a breakdown of 1.1309 (2019 low Jan.2) would target 1.1268 (monthly low Dec.14 2018) en route to 1.1214 (2018 low Nov.12).