Investing.com – EUR/USD started the week slightly higher on Sunday evening, but remains far from canceling the underlying bearish bias, which was reinforced by further losses last week, the currency pair having marked a low at 1.0686, the lowest since June 7.
Recall that a few US indicators above expectations had strengthened the dollar, and fueling speculation on the fact that the Fed would not may not be done with raising rates, although it is preparing for a break for its September meeting.
Indeed, the Investing.com Fed rate barometer still shows that the market is convinced that the Federal Reserve will abstain next week (93% probability), but the debate remains open regarding November, the tool showing a probability of more than 40 that the Fed will resume raising rates.
In this context, the US statistics expected this week will be monitored very closely. Among the most important are Wednesday's CPI, Thursday's retail sales and PPI, and Friday's consumer confidence.
Positive surprises for these data could further reinforce fears of a hawkish Fed, which would propel the Dollar higher, mechanically sending the EUR/USD into a sharper decline.
Technical thresholds at watch on EUR/USD
From a chart perspective, last week's low at 1.0686 and the psychological threshold of 1.07 combine to form the first key support area for EUR/USD.
Below this threshold, the next potential support will be the May 31 low at 1.0635, before the psychological threshold of 1.06. Finally, if EUR/USD moves higher, 1.08 and the 200-day moving average at 1.0823 will form the first significant obstacle to watch, before the threshold of 1.09 and the 100-day MA at 1 .0905.
EUR/USD maintains a bearish bias despite a slight improvement, ahead of key data
