EUR/USD back above 50-DMA on USD sell-off

Broad based USD weakness in Asia helped EUR/USD move back above 50-DMA level of 1.1162, although the pair is having a hard time breaching 1.1173 (23.6% of Friday’s high-low).

Dollar on the back foot

The greenback is on the back foot on speculation the Fed is unlikely to move rates this week despite the improvement in the monthly CPI numbers released on Friday. Moreover, the September rate hike bets are well below 50% and experts believe the Fed would never risk moving unless the rate hike bets are at least closer to 60%.

Apart from the Fed rate decision, the traders would also keep an eye on the BOJ decision due on Wednesday. The spot was last seen trading around 1.1170.

EUR/USD Technical Levels

Spot breached a week long range of 1.12-1.13 on the lower side on Friday. Thus, a breach of 1.12 (100-DMA) level today could yield a rally to 1.1272 (Sep 7 high) – 1.13 levels. On the lower side, breach of 50-DMA support of 1.1162 would open doors for a sell-off to 1.1145 (200-DMA) – 1.11 levels.