- The EUR /USD pair rose on Wednesday as doubts about another Federal Reserve interest rate increase this year and expectations for European Central Bank hawkishness weighed on the dollar.
- The euro hit $1.1868, its highest level against the dollar since January 2015. In contrast to the political risks and monetary policy uncertainty that have plagued the dollar, the common currency has drawn support from expectations that the ECB would eventually begin phasing out its easy policy.
- The dollar's weakness this year has been fuelled by a steady unwinding of expectations of optimism about U.S. President Donald Trump's stimulus plans and falling hopes to the extent of a Federal Reserve policy increase in the coming months.
- The ongoing upside is set to continue for this pair as the support level at 1.1786 is likely to act as strong barrier to the bears and push the pair towards higher levels.
- To the upside, the immediate resistance can be seen at 1.1885, a break above this level would expose the pair to next resistance level at 1.1900.
- To the downside, immediate support can be seen at 1.1835, a break below at this level will open the door towards next level at 1.1786.
Resistance Levels
R1: 1.1885 (38.2% Retracement level)
R2: 1.1900 (Psychological levels)
R3: 1.1946 (23.6% Retracement level)
Support Levels
S1: 1.1835 (50% Retracement level)
S2: 1.1786 (61.8% Retracement level)
S3: 1.1715 (July 31st lows)
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