<\/p>\n
EUR\/USD<\/a>\u00a0tests territory above the key resistance of 1.1200 in Wednesday\u2019s North American\u00a0session. The major currency pair gains as the US Dollar (USD) remains under pressure amid an improvement in investors\u2019 risk appetite due to China\u2019s massive stimulus plans announcement on Tuesday in an attempt to revive their economy from growing slowdown risks. Generally, investment flows to the US Dollar get reduced in times of cheerful market sentiment.<\/p>\n Apart from China\u2019s massive stimulus, increasing Federal Reserve (Fed) large rate cut bets in November has also kept the US Dollar on the back foot. The US Dollar Index (DXY), which tracks the Greenback\u2019s value against six major currencies, edges higher on Wednesday but remains close to the yearly low of 100.20.<\/p>\n The CME FedWatch tool shows that the likelihood of the Fed reducing interest rates by 50 basis points (bps) to the range of 4.25%-4.50% has increased to 60% from 37% a week ago. The Fed<\/a> also started the policy-easing cycle on September 18 with a larger-than-usual rate cut of 50 bps as officials were concerned over declining labor demand.<\/p>\n This week, the major trigger for the US Dollar<\/a> will be the United States (US) core Personal Consumption Expenditures Price Index<\/a> (PCE) data for August, the Fed\u2019s preferred inflation gauge, which will be published on Friday. The underlying inflation measure is estimated to have accelerated to 2.7% from 2.6% in July.<\/p>\n Before the Fed\u2019s preferred inflation gauge, investors will focus on the US Durable Goods Orders for August, which will be published on Thursday. New Orders for Durable Goods are expected to have declined by 2.6% against a robust growth of 9.8% in July.\u00a0<\/p>\n <\/a><\/p>\n EUR\/USD rises to near the key resistance of 1.1200 and aims to capture it in the European trading session on Wednesday. The major currency pair delivers a sharp recovery after finding strong buying interest near the 20-day Exponential Moving Average (EMA), which trades around 1.1100.<\/p>\n The outlook of the major currency pair would remain firm till it holds the breakout of the Rising Channel chart pattern formed on a daily time frame near the psychological support of 1.1000.\u00a0<\/p>\n The 14-day Relative Strength Index (RSI) moves lower to 55.00, suggesting momentum is weakening.<\/p>\n Looking up, a decisive break above the round-level resistance of 1.1200 will result in further appreciation toward the July 2023 high of 1.1276. On the downside, the psychological level of 1.1000 and the July 17 high near 1.0950 will be major support zones.<\/p>\n The Core Personal Consumption Expenditures (PCE), released by the US Bureau of Economic Analysis<\/a> on a monthly basis, measures the changes in the prices of goods and services purchased by consumers in the United States (US). The PCE Price Index is also the Federal Reserve\u2019s (Fed) preferred gauge of inflation. The YoY reading compares the prices of goods in the reference month to the same month a year earlier. The core reading excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures.” Generally, a high reading is bullish for the US Dollar (USD), while a low reading is bearish.<\/p>\nDaily digest market movers: EUR\/USD gains as Euro outperforms its major peers<\/h2>\n
\n
Technical Analysis: EUR\/USD rises\u00a0further\u00a0above 1.1200<\/h2>\n
Economic Indicator<\/h2>\n
Core Personal Consumption Expenditures – Price Index (YoY)<\/h3>\n