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The U.S. Dollar versus the Euro is sitting right at a key level. A topside break of 1.17 Euro-USD would mean there's medium term upside potential to 1.24. The currency pair has bounced around but that's the key level.

U.S. inflation percolating may be one reason the dollar may continue to slide. There's pressure in the U.S. for the U.S. Fed to cut rates. Many Fed officials after the latest round of slightly-high CPI and PPI have not come out to confirm a cut. But markets are pricing in a cut with an 85% chance.

With inflation threatening and many U.S. tariffs recently reinstituted August 1st, there's risk for higher levels of inflation. Many Fed officials have noted this. Fed Chair Powell in the recent Fed press conference said that, 'we have a long way to go to really understand exactly' how tariffs will affect inflation. That appears to mean that the Fed is not ready to claim they know the true impact of tariffs on inflation and so may be less inclined to quickly cut rates.

Based on Powell and other Fed officials it appears early to cut so if they cut, or in advance, if the market expects a cut, the dollar has risk. (Inflation is the change in prices of goods and services so if inflation rises the amount of money needed to buy those goods rises, thus the currency's value declines versus those items. Inflation is negative for the underlying currency value or said another way an inverse indicator of the currency's value.)

The U.S. Dollar started its slide earlier in the year probably because foreign investors wanted to repatriated investments after worrying about a trade war.

It's possible that the recent Ukraine-Russia peace negotiations can have an impact on the currency pair as well.

We'll see if the EUR-USD pair will continue higher, dollar lower, as it appears to be doing. 1.17 will be the key level to watch for a medium term move.

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