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- US dollar strengthens during the American session as stocks slide, despite lower yields.
- EUR/USD finds resistance at the 20-day simple moving average.
The EUR/USD pair is moving sideways on Tuesday, unable to hold above 1.1600. Recently it printed a fresh three day high at 1.1608 but it quickly pulled back toward daily lows. It is hovering under 1.1580 wihtouy a clear direction.
The greenback gained momentum during the America session across the board, even as US yields remained near recent lows. The DXT is up 0.05%, ending a two-day negative streak.
US economic data showed the PPI rose mostly in line with expectations, having no significant impact on markets. On Wednesday, CPI data is due. Those numbers will be important for considerations about the next steps of the Federal Reserve. Also, market participants await President Biden’s decision regarding Fed’s Chair. The specialized media mentioned Brainard (a dovish) as a potential replacement for Powell.
EUR/USD upside capped by a strong area
The rally from YTD lows found resistance around 1.1600/10, area that contains the 20-day moving average. Slightly above at 1.1620 there is another relevant horizontal resistance. A daily close above 1.1620 would open the doors the more gains.
While under 1.1600, the upside seems limited. Support levels might be located at 1.1565 and 1.1545. If the price rmeais under 1.1550, the 1.1520 critical support are will liekyl be challenged.