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  • EUR/USD loses ground on the day, moving below the 1.1600 key mark.
  • In the wake of the FOMC decision, the EUR/USD remains rangebound.
  • ECB’s stance on inflation may provide some room for the Euro bulls.

The EUR/USD price is trading in a tight range above 1.1580 on Wednesday as the single currency loses value against the dollar.

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As other global markets prepare for the upcoming FOMC meeting later on Wednesday, the EUR/USD pair manages to reverse Tuesday’s pullback somewhat.

Remember that, according to market consensus, the Federal Reserve will announce the beginning of quantitative easing this month, with rates possibly falling by $15 billion per month and ending sometime in mid-2022. However, investors are divided as to whether it will be “dovish” or “hawkish.”

In September, it was estimated that the unemployment rate in the euro area would fall to 7.4%. As part of the weekly MBA mortgage application process in the US data room, factory orders, ADP reports, and ISM non-manufacturing reports must be submitted.

The EUR/USD’s upside potential is currently constrained by the pair’s inability to successfully break the 1.1600 level. As of now, the spot continues to monitor trends in risk appetite to determine the direction and momentum of the dollar, while the loss of momentum has also dampened economic recovery in the region, consistent with some weakness in fundamentals on optimism, investors, and curbing bullish attempts in the European currency.

The ECB’s steady hand against the backdrop of persistent inflation in the region and the prospect of further development, combined with investor expectations for an early start, should cause the single currency to stay on trial for growth longer than previously thought.

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EUR/USD price technical analysis: Bears dominating under 1.1600

EUR/USD price chart analysis

The EUR/USD price pared yesterday’s gains and came below the 1.1600 level. However, the price has shown some strength in the recent hour, moving above the 20-period SMA on the 4-hour chart. But the upside still remains capped by the 50-period SMA and 1.1600 key resistance. The average daily range is 38% so far, while the volume data is neutral. However, the overall tone and outlook are still negative and may go for a test of YTD lows at 1.1520 area.

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