Euro edges higher
EUR/USD is pushing higher ahead of the Federal Reserve meeting statement tonight at 7pm (London time). The underwhelming economic releases from the US lately has convinced the market that tonight’s statement will be on the dovish side.
Yesterday’s expected drop in the Conference Board consumer confidence (95.2 in April from 101.4) highlights how fragile the US recovery is. When you factor in the disappointing non-farm payrolls and consumer price index (CPI) data this month, it is clear why the US dollar has been in retreat.
EUR/USD was also given a boost by the news that the Greek finance minister Yanis Varoufakis has been taken off the front line of the nation’s negotiating team. Mr Varoufakis has rubbed up many of the country’s creditors the wrong way, and with him taking a back seat the country stands a better chance of brokering a deal over its debt.
EUR/USD is receiving support from the $1.0945/50 area, and if this level is held the resistance at $1.10 will be the target. If that mark is cleared, then $1.1044 will be on the radar – a level not seen since the Fed meeting in March. A drop through the $1.0945/50 region will make $1.09 the next target, and then the 100-hour moving average at $1.0860 will be the next level of support.