The EUR/USD currency cross has recorded its third consecutive day of advances, trading in the 1.1370’s as of this writing. The euro is climbing, looking to multi-day highs. It is capitalizing on a waning US dollar. Picturing dollar’s free fall The last few weeks has demonstrated a very dramatic downward trajectory for the Greenback. Market participants are abuzz with speculation ahead of the Federal Open Market Committee (FOMC) meeting next Wednesday.
The US dollar continued to come under heavy selling pressure these last several days, in light of a number economic factors. This downward movement has been everything in helping to shield the euro’s position against its American counterpart. Traders are fine-tuning their expectations with all these developments heading into the FOMC meeting. They think that remarks coming from the Federal Reserve Chair Jerome Powell would likely drive the direction of EUR/USD currency pair.
While the EUR/USD dynamics are worth following, our neighbor to the south, the Australian dollar, is playing some interesting moves too. The AUD/USD cross has recently exploded higher, rallying within mere pips of the psychological 0.6500 resistance level. This upward momentum in AUD/USD highlights the overall strength of currencies outside of the US dollar amidst persistent tariff uncertainties affecting global trade.
The market is still wary, though, as ongoing tariff effervescence keeps causing the sell-off. Either economic data or geopolitical developments have the potential to move market sentiment dramatically in the days leading up to the FOMC meeting. As such, traders are advised to closely monitor any news that might impact inflation expectations or interest rate decisions from the Fed.
EUR/USD is watching Powell closely for clues. Our analysts suggest its price prediction will remain in a channel above and below 1.1300 as the next meeting date approaches. How the market reacts to the FOMC’s decisions will likely determine how things go for future currency swings.