On Tuesday, the dollar fell in price against the euro and a basket of major currencies after mixed economic news from the US was published. Thus, durable goods orders reduced 3.4% in December having disproved a 0.5% growth forecast. Core durable goods orders reduced 0.8% over the same period. In the meanwhile, the US consumer confidence index grew up to 102.9 points. This is the highest value since August 2007.
The euro may consolidate slightly today before the US Fed's meeting. It seems hard to forecast the decision the US monetary authorities will take owing to the world's unstable economy. Apparently, the interest rate will remain the same, which will lead to the euro continuing to grow against the dollar. In case the Fed decides to raise the key rate, the euro will weaken substantially, therefore short positions are recommended: the US regulator's decision will have a long-life effect.
Support and resistance
The closest resistance level is a price 1.1383 - today's trading maximums.
The support level is a price 1.1306 – a 55-period moving average.
Open long positions at current price with a target at 1.1383 and protective order at 1.1306.
Analyst at LiteForex Investments Limited