The EUR/USD pair has regained its traction and turned positive on the day near 1.0750 after having declined toward 1.0720 in the early European morning. Market action remains subdued mid-week as investors stay on the sidelines while waiting for Thursday’s US CPI data.
Static resistance seems to have formed at 1.0750. Once the pair rises above that level and starts using it as support, it could target 1.0800 (psychological level, static level) and 1.0840 (static level). It’s worth noting that the Relative Strength Index (RSI) indicator on the four-hour chart is about to cross above 70. Buyers could move to the sidelines in the near term and wait for a downward correction before taking action.
On the downside, 1.0700 (psychological level, static level) aligns as the first support before 1.0640 (50-period Simple Moving Average (SMA), 100-period SMA) and 1.0580 (200-period SMA).
Meanwhile, the US stock index futures trade modestly lower on the day. Investors are unlikely to place large positions ahead of Thursday Consumer Price Index (CPI) data from the US. After having registered strong gains on Tuesday, Wall Street’s main indexes could stage a correction and help the US Dollar hold its ground in the second half of the day. In case the risk rally picks up steam, however, EUR/USD could continue to stretch higher.
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