Today I’m going to show you the EURUSD Pre-FOMC range I’m trading, along with an update on the DXY hourly channel.
The EURUSD is testing the key support I mentioned over the weekend, but bulls have a lot of work to do ahead of this week’s events.
Watch the EURUSD video below and scroll down for the annotated charts and analysis.
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We’re seeing the EURUSD test the 1.1070 support I mentioned in Saturday’s Weekly Forex Forecast.
That’s a critical support for the euro as we head into this week’s FOMC.
The US Dollar Index (DXY) is also testing the top of the hourly channel I discussed over the weekend.
As long as the DXY remains below the 101.50 region, I favor a pullback into 100.80 support.
However, getting a favorable trade in before Wednesday’s FOMC volatility will be tricky.
The bigger opportunity may materialize following Wednesday’s events once the DXY tests 100.80.
While there’s no guarantee we get the retest, bullish continuation from the DXY at 100.80 could trigger a move to 102.00.
Alternatively, a sustained break below the 100.80 region would open up the 100.00 support.
Given that the EURUSD and DXY move inversely to each other, I’ll be using the US dollar levels above to position myself in EURUSD and other major currency pairs.
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