EURUSD Technical Outlook (Daily)
EURUSD: Forex markets were thin at the beginning of the day, with the USD easing alongside with risk averse sentiment, and the single currency recovering up to 1.1244, ahead of the US FOMC meeting policy announcement.
Once again, the Fed delayed a rate hike, and the USD dove Vs all of its peers, on news that the FOMC members unanimously voted to live rates unchanged.
The “dot” plot showed 6 officials look now for 1 rate hike this year, while expectations are of 3 rate hikes in Y 2017 and another three in Y 2018.
US GDP forecast is revised lower, to 2.0% from previous 2.2%, whilst they reckon that “the pace of improvement in the labor market has slowed while growth in economic activity appears to have picked up.”
During Ms. Yellen’s Quarterly press conference, she said that economic indicators have been mixed and that there is no preset course for the economic policy.
Nothing really new from the Schoolmarm, but she also added that growth has posted a “sizable rebound” in Q-2, but it has been “lackluster” according to her words. Also, she said that they expect core inflation will reach the 2.0% target over the next 2 to 3 years.
During her press conference, and after being questioned, she added that a July hike “it’s not impossible” if data improves enough. Confusing No, meant to confuse, perhaps.
The EURUSD flirted with 1.1300 during the session, but despite the Dovish stance, the pair was unable to break above it and pullback to the 1.1250 region, seeing some buying interest around its 20-Day SMA in the 4 hours.
The technical indicators in that frame remain below their mid-lines, modestly retreating, stronger selling interest remains at 1.1295, the 38.2% Fibo retracement of the May’s decline.
The Fed paints a gloomy US economic picture, something that should keep the Buck under selling pressure for sometime.
Support marks:1.1245 1.1190 1.1140
Resistance marks: 1.1295 1.1340 1.1385
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