EUR/USD Current price: 1.1709
- The Federal Open Market Committee will release the Minutes of the June meeting.
- Tariff-related uncertainty weighs on the market mood and underpins the US Dollar.
- EUR/USD stuck around 1.1700, yet at risk of falling further in the near term.
The EUR/USD pair is under mild selling pressure on Wednesday, as the US Dollar (USD) retains its fears-inspired strength, but lacks momentum ahead of the Federal Open Market Committee (FOMC) meeting Minutes. The document explaining policymakers’ reasoning behind the June decision is not expected to say anything different from what financial markets already know, that is, that the Federal Reserve (Fed) is in no rush to trim interest rates.
United States (US) President Donald Trump has put pressure on the central bank to move forward on the path of loosening, to no avail. Trump has reached the point of insulting Fed Chairman Jerome Powell, without acknowledging that Powell’s concerns revolved around the uncertainty fueled by Trump himself.
The back and forth in tariffs generates uncertainty about the economic performance of the US, as tariffs may fuel inflationary pressures. Indeed, in his latest public appearance, Chair Powell noted that the impact has been below feared so far. Still, and considering that President Trump extended once again the deadline to reach deals and impose massive levies, uncertainty remains the same. The Fed won’t make a decision until the picture becomes clearer.
Meanwhile, the European macroeconomic calendar has been quite scarce. No relevant data was released, while comments from European Central Bank (ECB) officials brought nothing new to the trading table. Ahead of the FOMC Minutes, the US will publish May Wholesale Inventories.
EUR/USD short-term technical outlook
The EUR/USD pair hovers around 1.1700, little changed for a second consecutive day. The technical picture is still bullish, although with the momentum fading, according to technical readings in the daily chart. EUR/USD holds well above bullish moving averages, with the 20 Simple Moving Average (SMA) providing dynamic support in the 1.1640 region. However, technical indicators aim marginally lower, still within positive levels but suggesting buyers are retreating.
In the near term, and according to the 4-hour chart, EUR/USD is at risk of falling further. A bearish 20 SMA keeps rejecting intraday advances, currently standing in the 1.1730 price zone. The 100 and 200 SMAs maintain their upward slopes below the current level, but are losing their former strength. Finally, technical indicators are neutral-to-bearish below their midlines, anticipating another leg south without confirming it.
Support levels: 1.1685 1.1640 1.1590
Resistance levels: 1.1730 1.1770 1.1805
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