• The EUR/USD remained under pressure as markets awaited the Fed rate cut decision. 
• The greenback’s renewed strength and weak Eurozone economic data weigh on the pair.
• Traders look forward to commentary from FOMC members for further policy cues. 

The EUR/USD outlook shows a bearish momentum as the pair trades near 1.1635 ahead of the US Federal Reserve meeting today. Markets remain cautious as traders expect a 25-bps cut. This rate cut will likely lower the Fed funds rate to 3.75%-4.00%, supporting the declining US economy amid the softer US consumer confidence and labor market conditions.

The Conference Board revealed the CCI dropped to 94.6, the lowest since April. Meanwhile, the employment sector also faces a decline amid large-scale layoffs in the private sector. Consequently, investors anticipate expectations of Fed easing, but the markets are on hold ahead of Chair Jerome Powell’s remarks for further direction.

In the Eurozone, the euro is under pressure ahead of the ECB meeting on Thursday. Investors expect the ECB to keep the interest rate unchanged for a third consecutive meeting. Meanwhile, the weak German manufacturing and Eurozone GDP growth weigh on the euro, capping further upside. 

Additionally, the progressing US-China trade situation and the upcoming meeting between President Trump and Xi support the greenback as investors focus on safety amid the ongoing uncertainty. 
 

EUR/USD Daily Key Events

The major events in the day include

• German 10-year Bond Auction
• US Federal Funds Rate
• US Pending Home Sales m/m
• US FOMC Statement
• US FOMC Press Conference

On Wednesday, traders await the US FOMC rate decision and press conference along with the German 10-year bond auction, for insights into the investor confidence and further yield trends. 
 

EUR/USD Technical Outlook: Bears Eyeing 1.1600 Breakout
 

(Click on image to enlarge)

EUR/USD 4-hour chart
 

The EUR/USD 4-hour chart reflects limited momentum as the pair trades around 1.1630. The price stays below the key 200-period SMA, suggesting a broad bearish bias. Meanwhile, the 50- and 100-period MAs around the 1.1625 area show a flat movement. This suggests a consolidation in the market after last week’s uptrend. 

The RSI at 45 suggests a potential neutral momentum for the pair. A drop below the 50-MA around the 1.1625 level could revive the selling pressure and extend the downside towards the key support levels. 

Conversely, the pair could witness a potential upside if the market sentiment turns positive after the FOMC decision and buyers hold above the 1.1620 zone. 
 

Support Levels

• 1.1600
• 1.1575
• 1.1540
   

Resistance Levels

• 1.1650
• 1.1685
• 1.1710

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