Despite worse-than-expected German business-confidence data the euro has held up well against the U.S. dollar Monday. Although prices fluctuated within a confined band of only 40 pips, the euro showed resilience against the greenback ahead of the Federal Reserve meeting. With the euro remaining firmly above 1.1240, we expect another test of the 1.13-barrier, which may result in an upswing towards 1.1335 and 1.1355. However, while we do not expect a shift in sentiment a test of these lower resistances might be likely before the Fed statement.
The British pound tested the 1.45-mark but was unable to sustainably maintain the high price level. Whether we will see an extended upside move remains to be seen and should also hinge on the performance of the U.S. dollar. Above 1.4520 the pound could extend its gains towards 1.4560 and 1.4590. However, below 1.4480 it could fall back towards 1.4450 and 1.4410.
Traders should keep an eye on important economic data from the U.S. such as Durable Goods Orders, scheduled for release at 12:30 UTC and Consumer Confidence due at 14:00 UTC.
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