EUR/USD spiked higher after the release of the FOMC minutes but it quickly tuned to the downside, trimming recent gains. The pair rose to 1.1355 immediate after the release but now is trading near the 1.1320 area, moving toward daily lows.
Earlier today the pair bottomed at 1.1311, the lowest level since June 28. After the beginning of the American session, recovered some lost ground but the momentum now is starting to favor again the downside.
The minutes from the latest FOMC meeting, when the Fed, as expected rose interest rates to the 1.00-1.25% range, showed that there is no agreement on when to start the normalization process of the balance sheet. According to the document, most members viewed recent softness in inflation as having little bearing on the trend.
The greenback rose modesty in the market after the minutes. The impact overall was limited in the immediate minutes, with equity prices moving marginally lower and US yields higher, all remaining within day’s range.
Levels to watch
To the upside, resistance levels might lie at 1.1345 (20-hour moving average), 1.1370 (daily high) and 1.1390 (Jun 28 high). On the flip side, support could be seen at 1.1310 (daily low), 1.1290 (Jun 28 low) and 1.1265 (May 23 high).