EUR Trading Outlook (28-01-2015)

EUR/USD The pair’s relief rally went a bit further in the NY session. Traders fears of disappointment from the Fed in the form of dovish rhetoric increased and soft US durable goods orders softened the USD. EUR/USD lifted from the 1.1260 area and hit a high of 1.1423. A turn in the USD’s fortunes took hold after US consumer confidence data. The USD’s rally, lead by USD/JPY, saw EUR/USD slip a bit form the highs. The pair dipped to old resistance near 1.1350/55 before bouncing late in the day. It sat near 1.1370 towards the close. Traders will now turn their focus to the Fed tomorrow. Some fear that the Fed will have heard the cries from corporate America over the strong USD hurting earnings. Should the Fed give in and strike a dovish tone the USD and yields should sink. EUR/USD’s squeeze should then get another boost. The pair might then break key s-t resistance near 1.1460 and make a run towards larger resistance near 1.1650/00.