The Euro is trading higher against the U.S. Dollar at the mid-session on Wednesday, but hovering below two-year highs as traders await the release of the U.S. Federal Reserve’s interest rate and monetary policy decisions.
The Fed is expected to leave interest rates unchanged and reiterate that it’s not likely to raise rates for at least two years. The Fed is also expected to reiterate its dovish tone and may even announce new stimulus measures to combat the economic damage being caused by rising COVID-19 cases.
Additionally, Fed Chairman Jerome Powell will hold a press conference. He’s expected to say the economic recovery will slow if the coronavirus isn’t contained. A stern rebuke from Powell could trigger a surge in the Euro.
At 13:23 GMT, the EUR/USD is trading 1.1756, up 0.0039 or +0.34%.
In other news, Euro Zone government bond yields edged up before a U.S. Federal Reserve meeting later on Wednesday, but remained within touching distance of two-month lows as a variety of negative headlines hurt market sentiment.
Additionally, analysts at DZ Bank said, “Meanwhile, the consensus over a second coronavirus relief package which could be used to alleviate a second wave of the pandemic is tottering, thus spawning growing concerns about the outlook for the U.S. economy.”
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through 1.1781 will signal a resumption of the uptrend. The EUR/USD is in no position to change the main trend to down, but there is plenty of room to the downside with several retracement levels reasonable downside targets.
Daily Swing Chart Technical Forecast
A trade through 1.1781 could trigger a breakout to the upside with the September 24, 2018 top at 1.1816 the next likely upside target. This is also a trigger point for an acceleration to the upside.
Meanwhile, there is no trigger point for an acceleration to the downside, but taking out Monday’s low at 1.1624 will break the bullish pattern. This could lead to an eventual test of the short-term 50% level at 1.1576.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
More From FXEMPIRE:
- GBP/USD Price Forecast – British Pound Reaching Major Figure
- Natural Gas Price Forecast – Natural Gas Markets Continue to Find Buyers
- Silver Price Daily Forecast – Silver Tries To Stabilize After Wild Swings
- Daily Forex Briefing 29/07/2020
- AUD/USD Price Forecast – Australian Dollar Continues to Rally
- Gold Price Forecast – Gold Markets Continue to Grind