Downside move stalls at the 100-hour MA
The 100-hour MA (red line) is so far helping to limit any downside in the pair to start the week and that means that price bias in the near-term continues to favour buyers. However, despite the upside bias, price remains capped by offers and resistance around the 1.1800 region.
There isn’t much on the calendar today so price looks to be setting up for a range between the key hourly moving averages and the 1.1800 level ahead of the FOMC meeting tomorrow. I don’t expect Praet’s speeches later to have any important bearings on monetary policy but if anything, expect it to keep the euro underpinned – much like Draghi’s speech overnight.
Given that context, EUR/USD should stay between 1.1700 to 1.1800 ahead of the Fed tomorrow with the only key influence in the pair ahead of that being dollar positioning ahead of the decision, statement, press conference.
A rate hike tomorrow is a slam dunk but the focus is whether or not we’ll get any further clues of a December rate hike. That will be the next important driver in EUR/USD this week.
But also, don’t discount the possibility of some spillover to come from Italy’s fiscal draft on the budget to come on Thursday. Adam provided a good primer on that here yesterday.