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Forex Market: EUR/USD extends gains ahead of ECB Forum, dollar softens as investors cut back Fed hike bets

EUR/USD extended Friday’s gains at the start of the new week ahead of Tuesday’s ECB forum in Sintra, Portugal. Fed Chair Jerome Powell, ECB President Christine Lagarde and Bank of England Governor Andrew Bailey are all expected to make speeches at the event.

Meanwhile, the US Dollar continued pulling back from a 20-year peak after a University of Michigan survey released Friday revealed US consumer sentiment had decreased to a record low in June, with the overall index revised down to 50.0. The current economic conditions sub-index plunged to an all-time low of 53.8 in June, while the expectations sub-index sank to a reading of 47.5.

The data gave another prompt for market players to cut back bets on Federal Reserve interest rate hikes. Traders are now expecting the Fed’s target range for the federal funds rate to stabilize around 3.50% from March 2023, compared to earlier expectations of 4.00%.

Still, however, concerns over a possible global economic downturn provided certain support to the greenback, while limiting its losses. The Dollar Index was down 0.28% on the day at 103.825, after scaling a two-decade high of 105.79 earlier in June.

As of 8:18 GMT on Monday EUR/USD was edging up 0.25% to trade at 1.0583. Last week the major Forex pair climbed as high as 1.0606, which has been its strongest level since June 10th (1.0642).

EUR/USD has retreated 1.37% so far in June, following a 1.80% gain in May.

Daily Pivot Levels (traditional method of calculation)

Central Pivot – 1.0547
R1 – 1.0581
R2 – 1.0606
R3 – 1.0641
R4 – 1.0675

S1 – 1.0522
S2 – 1.0487
S3 – 1.0463
S4 – 1.0439 is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

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