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EUR\/USD clings to gains above the crucial support of 1.0800 in Tuesday\u2019s European session. The major currency pair holds gains as the US Dollar (USD) remains under pressure due to firm market speculation that the Federal Reserve<\/a> (Fed) will start reducing interest rates in September.<\/p>\n According to the CME FedWatch tool, traders see a 77% chance that interest rates will be lower than current levels in the September meeting, up from 65.6% recorded a week ago. Easing United States<\/a> (US) labor market strength has prompted expectations for the Fed to pivot to policy normalization in September. The Unemployment Rate rose to its highest in more than two years, and Average Hourly Earnings eased expectedly in June, pointing to moderating labor market conditions.<\/p>\n For fresh guidance on interest rates, investors will shift focus to the Fed Chair Jerome Powell\u2019s semi-annual Congressional testimony, scheduled at 14:00 GMT. Powell is expected to reiterate that interest rates need to be held steady at their current levels until they observe a decline in inflationary pressures for months.\u00a0<\/p>\n Powell<\/a> acknowledged, in the European Central Bank (ECB) Forum of Central Banking, that the central bank has made quite a bit of progress on inflation, and recent data shows that the disinflation process has resumed.\u00a0<\/p>\n For more clarity on disinflation, investors will focus on the US Consumer Price Index (CPI) report for June, which will be published on Thursday. The core CPI data, which excludes volatile food and energy prices, is estimated to have grown steadily, while headline figures are expected to have decelerated.<\/p>\n <\/a><\/p>\n EUR\/USD trades inside Monday\u2019s trading range as investors stay on the sidelines ahead of the Fed Powell\u2019s testimony. The major currency pair stabilizes above the 20-day and 50-day Exponential Moving Averages (EMAs), which trade around 1.0750 and 1.0770, respectively. The overall trend of the shared currency pair has also strengthened as it has jumped above the 200-day EMA, which trades around 1.0800.<\/p>\n The Symmetrical Triangle formation on the daily timeframe exhibits a sharp volatility contraction, which indicates low volume and narrow ticks.<\/p>\n The 14-day Relative Strength Index (RSI) reaches 60.00. Should the bullish momentum be triggered if it breaks above 60.00?<\/p>\n Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as the Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics<\/a>. The YoY reading compares the prices of goods in the reference month to the same month a year earlier. The CPI Ex Food & Energy excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures. Generally speaking, a high reading is bullish for the US Dollar (USD), while a low reading is seen as bearish.<\/p>\nDaily digest market movers: EUR\/USD stabilizes above\u00a01.0800 as ECB\u2019s Knot pushes hope subsequent rate-cut hopes<\/h2>\n
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Technical Analysis: EUR\/USD holds\u00a0above all short-to-long-term EMAs<\/h2>\n
Economic Indicator<\/h2>\n
Consumer Price Index ex Food & Energy (YoY)<\/h3>\n