- EUR/USD is chipping away at key resistance at 1.1265.
- A break higher would expose 1.13.
The American Dollar remains on the defensive in Asia as expectations of a July rate cut have firmed, courtesy of dovish testimony by the US Federal Reserve Chairman Powell. The market is now pricing around 30 basis points of easing on 31 July.
The US Dollar weakness has pushed EUR/USD higher to 1.1265. That level marks the confluence of the 4-hour chart 200- and 50-candle moving averages and also the trendline connecting May 30 and June 18 low.
A convincing break higher would add credence to the falling wedge breakout, a bullish reversal pattern, on the 4-hour chart and open the doors to levels above 1.13.
The bulls, however, may have a tough time forcing a convincing break above 1.1265, as the 4-hour chart 50- and 200-dandle MAs are about to produce a bearish crossover.
As of writing, EUR/USD is trading at 1.1264.
4-hour chart
-636984022133345199.png)
Trend: Bullish above 1.1265
Pivot points
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