Markets are at critical levels ahead of this week’s FOMC, and in today’s video, I’ll break down exactly how I’m trading the EURUSD.
Don’t miss it!
EURUSD broke above 1.0460 on Friday, paving the way for levels like 1.0615 this week.
Meanwhile, the DXY is bouncing from its December imbalance near 107.00, which I highlighted in Saturday’s Weekly Forex Forecast.
Today, the DXY tested new resistance at 107.80, adding another key level to watch.
This week’s Fed rate decision and press conference are likely to bring volatility, but the technicals for both EURUSD and the DXY remain clear.
For now, I’m short-term bullish on EURUSD as long as it holds above 1.0440 and the DXY stays below 107.80 on the daily time frame.
However, if the DXY reclaims levels like 108.00 and EURUSD drops below 1.0440, I’ll shift back to a bearish stance on the euro.
One area of interest for EURUSD, should the DXY continue to pull back, is 1.0687.
This level represents the November imbalance and the 50% retracement of the September to January decline.
A retest of 1.0687 could offer an attractive short opportunity for EURUSD, depending on how the DXY reacts to its monthly support near 106.00.
With the FOMC just days away, I’m holding off on trading EURUSD until we get one of these scenarios. The potential for increased volatility midweek makes patience key.
