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The EUR/USD pair trades near a fresh multi-week high of 1.1388 and could extend its rally up to 1.1460, as the market continues selling the greenback ahead of the Fed´s monetary policy announcement, FXStreet’s Chief Analyst Valeria Bednarik informs.

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Key quotes

“The US has just published May inflation data, which was worse than initially estimated. According to the official report, the annual CPI was at 0.1%, while the core reading printed at 1.2%. The figures had no impact on currencies, with EUR/USD hovering around 1.1360.”

“The focus will be on the Fed’s economic projections, although the market is considering a twist in monetary policy, a yield-curve control. The measure seems a bit too drastic at the time being. Rates are expected to remain on hold and the stimulus program as it is.” 

“In the 4-hours chart, the bullish potential has moderated a bit, but the risk remains skewed to the upside, as EUR/USD develops above all of its moving averages, although with the 20 SMA flat at around 1.1310.” 

“The Momentum indicator continues to advance within positive levels, while the RSI indicator consolidates around 70. Further dollar declines should see the pair target 1.1460, a long-term static resistance level.”

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