The EURUSD pair is comfortably maintaining its position above 1.1000, despite the USD Index experiencing a significant decline.

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• EUR/USD is sustaining auction confidently above 1.1000 amid a vertical sell-off in the USD Index.

The pair currently trades last at 1.10208.

The previous day high was 1.1002 while the previous day low was 1.0944. The daily 38.2% Fib levels comes at 1.0979, expected to provide support. Similarly, the daily 61.8% fib level is at 1.0966, expected to provide support.

The EUR/USD pair is maintaining an auction comfortably above the psychological resistance of 1.1000 in the Asian session. The major currency pair has got immense strength as the US Dollar Index (DXY) has continued its three-day losing spell.

S&P500 futures have added nominal gains in Tokyo. US equities were decently bought on Monday, portraying upbeat market sentiment. The USD Index has refreshed its two-month low at 101.74 despite the chances of one more interest rate hike from the Federal Reserve (Fed) in July being resilient. As per the CME Fedwatch tool, more than 92% chances are in favor of a 25 basis point (bp) interest rate hike, which will push rates to 5.25-5.50%.

The US Dollar Index is under severe pressure as July’s interest rate hike by Fed chair Jerome Powell could be the last nail in the coffin as tight labor market conditions are releasing heat and inflationary pressures are softening consistently.

Going forward, Wednesday’s United States Consumer Price Index (CPI) data will be keenly watched. As per the preliminary report, monthly headline CPI delivered a higher pace of 0.3% vs. the former pace of 0.1%. Also, core inflation that excludes oil and food prices is expected to match the headline CPI pace.

On the Eurozone front, investors are awaiting the final reading of German inflation data. Inflationary pressures in the German economy are significantly higher than other nations of the old continent, which will keep the odds of further policy-tightening by the European Central Bank (ECB) healthy.

ECB Governing Council member Francois Villeroy de Galhau said over the weekend, “Eurozone rates will soon reach their high point, but it will be more of a high plateau than a peak.”

Technical Levels: Supports and Resistances

EURUSD currently trading at 1.102 at the time of writing. Pair opened at 1.1001 and is trading with a change of 0.17 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.0912, 50 SMA 1.086, 100 SMA @ 1.0832 and 200 SMA @ 1.0627.

The previous day high was 1.1002 while the previous day low was 1.0944. The daily 38.2% Fib levels comes at 1.0979, expected to provide support. Similarly, the daily 61.8% fib level is at 1.0966, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.0963, 1.0924, 1.0905
• Pivot resistance is noted at 1.1021, 1.104, 1.1079

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