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Could the price of EURUSD could break higher towards 1.1000 if the Federal Reserve pauses interest rate hikes?

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EURUSD Analysis

The price of EURUSD could break higher by the end of this week if investors believe the Federal Reserve could pause interest rate hikes next week. This speculation comes off the back of the SVB collapse, as other banks in America call for the Fed to pause rate hikes or even begin to decrease rates. The Federal Reserve is in a sticky position as the Core Consumer Price Index (CPI) data came in above expectations. Despite this the market reaction was very tame as uncertainty grows. 

On the other hand the ECB will hike interest rates this week from 3.00% to 3.50%. This creates a divergence between the ECB and the Federal Reserve which could cause the price of EURUSD to trade higher. 

Technically, the price of EURUSD is trading in a small range between the lows of 1.0700 and highs of 1.0750. This range could break to the upside which could see buyers target the next level of resistance at 1.0805. If buyers get above this level the next daily level of resistance is the 1.1000 handle which are the highs in February. 

EURUSD

EURUSD How To Trade Forex Chart 14-3-23

The price on the chart has traded through multiple technical levels and some observations included:

  • EURUSD is trading within a 50 pip range.
  • A breakout higher could lead to price targeting the resistance of 1.0805.
  • If price trades above this resistance the next target is 1.1000.

Have you watched our CADJPY analysis? You can see it here

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