After the announcement by the FED, the Euro gained strong bullish momentum reaching the resistance zone around the 200 EMA at 1.1880.
The Fed has shown no hurry to modify its current quantitative easing program at its meeting on Wednesday. They do not believe that the rebound in inflation could affect the economy. Besides, the regulator said that the US economy is firmly on the path to steady recovery.
Investors were waiting for some signals about tapering bond purchases. This made them stop investing in the US dollar as a safe haven and turn to risky assets such as the Euro, British Pound, and others.
The USDX Dollar Index, meanwhile, deepens the decline and breaks the 200 EMA and the 6/8 Murray, registering new 4-week lows. The bias has turned bearish for the US dollar, we believe as long as it remains below the 21 SMA around 92.50, the Euro will benefit to continue rising.
According to the chart, EUR / USD now faces the key level in the zone of 1.1880-1.1901. There is the 200 EMA and the strong resistance of 3/8 of murray, which if overcome could enable a greater run towards the end of June top at 1.1975 and could reach the psychological level of 1.20.
Alternatively, a correction below the 200 EMA around 1.1870 will be a selling opportunity with targets at 1.1840 and 1.1800. The eagle indicator on a 4-hour chart is showing an overbought signal.
Support and Resistance Levels for July 29 - 30, 2021
Resistance (3) 1.1983
Resistance (2) 1.1946
Resistance (1) 1.1894
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Support (1) 1.1848
Support (2) 1.1816
Support (3) 1.1791
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Trading tip for EUR/USD for July 29 - 30, 2021
Sell below 1.1870 -1.1901 (EMA 200 - 3/8), with take profit at 1.1840 (2/8) and 1.1800, stop loss above 1.1905.
