The Euro is trading higher against the U.S. Dollar on Wednesday, mostly on position-squaring and short-covering ahead of the release of the minutes of the U.S. Federal Reserve’s mid-September monetary policy meeting at 18:00 GMT. Traders are also monitoring headlines regarding U.S.-China trade relations ahead of the start of trade talks on Thursday.
At 12:50 GMT, the EUR/USD is trading 1.0975, up 0.0018 or +0.16%.
The FOMC will release the minutes from its mid-September meeting at 18:00 GMT. The Fed cut rates last month by 25 basis points for the second time this year, citing “the implications of global developments for the economic outlook” among other factors.
Traders have put the chances of an October Fed rate cut at 77.5%, according to the CME Group’s FedWatch tool.
The FOMC vote was mixed so perhaps the minutes will reveal what it is going to take to make further rate cuts later this year.
Daily Technical Analysis
The main trend is down according to the daily swing chart. Momentum trended higher from October 1 to October 7, but has shifted slightly to the downside since the 1.1001 closing price reversal top.
A trade through 1.1001 will shift momentum to the upside, while a move through 1.0879 will signal a resumption of the downtrend.
The minor range is 1.0879 to 1.1001. Its 50% level or pivot at 1.0940 is potential support.
The short-term range is 1.1110 to 1.0879. Its retracement zone at 1.0995 to 1.1022 is resistance. It stopped the selling at 1.1001 on October 7. Overtaking 1.1022 could trigger a breakout to the upside.
Daily Technical Forecast
Based on the early price action and the current price at 1.0975, the direction of the EUR/USD the rest of the session on Wednesday is likely to be determined by trader reaction to uptrending Gann angle at 1.0939 and the uptrending Gann angle at 1.0999.
A sustained move over 1.0999 will indicate the presence of buyers. This could lead to a labored rally, however, with potential resistance layered at 1.1001, 1.1004 1.1020 and 1.1022.
Taking out 1.1022 could trigger an acceleration to the upside with the next target coming in at 1.1076.
The inability to sustain a move over 1.0995 will signal the presence of sellers. This could trigger a break into a support cluster at 1.0940 to 1.0939.
The uptrending Gann angle at 1.0939 is a potential trigger point for an acceleration into the next uptrending Gann angle at 1.0909.
This article was originally posted on FX Empire
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