EUR/USD continues to trade close to two year lows, after markets hopes that the Federal Reserve would take action were dashed. Minutes of the Fed’s June policy meeting indicated that Fed would continue to stand on the sidelines and not take any significant monetary measures to stimulate the US economy. Today’s key release is the US Unemployment Claims. Here’s an update on technicals, fundamentals and what’s going on in the markets. EUR/USD Technicals Asian session: Euro/dollar dropped to a low of 1.2224, consolidating at 1.2237. In the European session, the pair has edged downwards. Current range: 1.22 to 1.2288. Further levels in both directions: Below: 1.22, 1.2150, 1.20 and 1.1876. Above: 1.2280, 1.2330, 1.2360, 1.24, 1.2440, 1.2520 and 1.2624. 1.2330 is the next serious line of resistance. 1.22 is only a minor line before the clear historic separator of 1.2150. Euro/Dollar edges downwards after release of Fed minutes – click on the graph to enlarge. EUR/USD Fundamentals 5:30 French CPI. Exp. -0.1%. Actual: 0.0%. 6:00 German WPI. Exp. -0.5%. Actual: -1.1%. 8:00 ECB Monthly Bulletin. 9:00 Euro-zone Industrial Production. Exp. 0.0%. 12:00 ECB President Draghi Speaks. 12:30 US Unemployment Claims. Exp. 376K. See how to trade this event with USD/JPY. 12:30 US Import Prices. Exp. -1.5%. 14:30 US Natural Gas Storage. Exp. 27B. 17:00 US 30-year Bond Auction. 18:00 Federal Budget Balance. Exp. -91.7B. 19:40 FOMC Member John Williams Speaks. For more events and lines, see the Euro to dollar forecast EUR/USD Sentiment Federal Reserve takes no action: The Federal Reserve released the minutes of its June monetary policy meeting, but the markets did not really like what they heard. The Fed repeated and restated that that it would consider taking monetary measures to stimulate the economy, but only if the economy deteriorated. The markets had hoped to see more aggressive action from the Fed to prop up the sluggish US economy. Bottom line? QE3 looks very, very unlikely, although the Fed has left the door open for action, if needed. For the time being, Operation Twist is as far as the Fed is willing to go, unless things get worse. A lack of QE is bullish for the US dollar, which improved slightly against the euro following the release of the minutes. Eurogroup meeting ends on disappointing note: At this week’s Eurogroup meeting, finance ministers was supposed to take concrete steps towards implementing the decisions agreed to at the EU Summit. However, no agreement was reached on a crucial issue – the use of rescue funds to intervene in bond markets and lower Spain and Italy’s borrowing costs,which are threatening to spiral out of control. The finance ministers did agreed to extend Spain’s deadline to reach budget targets to 2014, and stated that EUR 30 billion in aid would be made available to Spanish banks by the end of July. Spain announces austerity measures: Spain is in bad shape, with an ailing bank sector, declining economic growth and a staggering unemployment rate of 24%. Under strong pressure from the EU, the government announced a EUR 65 billion austerity plan, which includes a sales tax hike and slashing government expenditures including unemployment benefits. The announcement has already drawn sharp criticism in Spain, and many analysts feel that these measures will only prolong Spain’s recession. ESM hits legal hurdle: The European Stability Mechanism, which is the Euro-zone’s rescue fund, was supposed to come into effect on July 1. However, the German Constitutional Court has delayed its decision on whether the ESM complies with German law. ESM cannot go ahead without German support, so for now, the ball is in the hands of the court. Euro remains at two-year lows following ECB rate cut: Last week, the European Central Bank cut its benchmark lending rate to a new historic low of 0.75% and also eliminated the deposit rate from the previous 0.25%. The move came after more QE from the UK and a rate cut from China. The impact on the euro from these moves by central banks was quite negative: a drop of over 100 pips in a short time, as the currency is now trading close to two-year lows against the US dollar. Draghi added fuel to the fire by saying that downside risks have materialized. He called the ESF unusable and stated that ESM is the preferred mechanism for relief funds. Is Italy next candidate for bailout?: Italian PM Mario Monti has asked for help from Germany and the ECB as the Italian economy sputters. The Euro-zone’s third largest economy is suffering from a problematic banking system, and GBP is contracting. This may explode later on. Here is more about a potential Italian bailout. Kenny Fisher Kenny Fisher Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer. Kenny's Google Profile View All Post By Kenny Fisher EUR/USD DailyForex News Today: Daily Trading News share Read Next Fault lines widen FxPro - Forex Broker 9 years EUR/USD continues to trade close to two year lows, after markets hopes that the Federal Reserve would take action were dashed. Minutes of the Fed's June policy meeting indicated that Fed would continue to stand on the sidelines and not take any significant monetary measures to stimulate the US economy. Today's key release is the US Unemployment Claims. Here's an update on technicals, fundamentals and what's going on in the markets. EUR/USD Technicals Asian session: Euro/dollar dropped to a low of 1.2224, consolidating at 1.2237. In the European session, the pair has edged downwards. Current range: 1.22 to 1.2288. Further… Top Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk.4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk.5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.