EUR/USD Down, Tries to Find Support from the US GDP Contraction
EUR/USD Analysis
The US Federal Reserve hiked rates by another 75 basis points on Wednesday and reiterated its commitment to bringing inflation down. However, chair Powell tried to prepare markets for potentially less aggressive moves ahead and did not provide guidance for September, pivoting to a "meeting by meeting" approach [1], which send EUR/USD higher.
It drops today though, unable to capitalize capitalize on the post-Fed jump. It does find some respite after the US GDP contraction earlier, as this could make it harder for the Fed to sustain its hawkishness, which has been the main source of strength for the USDollar.
The technical outlook has not changed much, since the risk of another visit to parity remains elevated, although 0.9856 still seems distant.
Hope is not lost yet for EUR/USD and it has not relinqueshed the chance to claim the key 1.0300-34 region, but the fact that it has not done so far, plays into our cautiousness in regards to its recovery prospects.
The aforementioned area contains the critical EMA200 and 23.6% Fibonacci of the 2022 High/Low drop and break above this region could potentially spark further recovery towards the 38.2% level (mid-1.0500s). However we need to see daily closes above it and the upside continues to look unfriendly, since the broader 1.0470-1.0650 area contains strong roadblocks.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
References
| Retrieved 19 Apr 2026 https://www.federalreserve.gov/monetarypolicy/fomcpresconf20220727.htm |
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