• EUR/USD hit 8-month high on Tuesday, climbing above the psychological 1.1100 level as dollar weakness intensified.
• The Fed's decision could influence whether EUR/USD continues to rally. If Fed Chair Jerome Powell adopts a dovish tone on Friday, the pair may rise significantly, potentially reaching the 1.1250 level.
•On the data front, Eurozone inflation increased to 2.6% in July, up from 2.5% in June. This slight rise matched Eurostat's preliminary data and exceeded initial economist estimates of 2.4%..
• Technical signals are strongly bullish as RSI is at 72, daily momentum studies 5, 9 and 10 DMAs are trending up.
• Immediate resistance is located at 1.1115( 23.6%fib), any close above will push the pair towards 1.1134 ( Higher BB)
• Strong support is seen at 1.1070(Daily low) and break below could take the pair towards 1.1049 (38.2% fib).
Recommendation: Good to buy around 1.1080, with stop loss of 1.0950 and target price of 1.1150
