20-day EMA acts as key barrier for Euro bulls
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EUR/USD falls sharply as the US Dollar bounces back strongly. The US Dollar recovers ahead of the US ISM Manufacturing PMI and the NFP data for July. Faster-than-expected Eurozone inflation growth has raised doubts over speculation of an ECB rate cut in September. The EUR/USD pair faces an intense sell-off after breaking below the round-level support of 1.0800 and posts a fresh three-week low at 1.0777 in Thursday’s European session. The major currency pair weakens after a sharp recovery in the US Dollar (USD). The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, surges to 104.40 after recovering from a fresh weekly low of 103.86. The US Dollar rose as market participants had already discounted the Federal Reserve’s (Fed) dovish guidance on interest rates in the monetary policy announcement on Wednesday. The Fed kept borrowing rates steady in the range of 5.25%-5.50%. Fed Chair Jerome Powell said policymakers have gained greater confidence from the Q2 inflation data. When asked about rate cuts in September, Powell replied, “If we were to see inflation moving down more or less in line with expectations, growth remains reasonably strong, and the labor market remains consistent with current conditions, then I think a rate cut could be on the table at the September meeting”, Reuters reported. Going forward, investors will focus on the United States (US) ISM Manufacturing PMI and Nonfarm Payrolls (NFP) report for July, which will be published at 14:00 GMT and on Friday, respectively. Meanwhile, faster-than-expected growth in preliminary Eurozone Harmonized Index of Consumer Prices (HICP) data for July has raised doubts about whether the European Central Bank (ECB) will cut interest rates in September. EUR/USD trades inside a Symmetrical Triangle formation on a daily timeframe, which exhibits a sideways trend. The aforementioned chart pattern signifies a…
Filed under: News - @ August 1, 2024 2:20 pm