The Euro (EUR) is in a tight range against the US Dollar (USD) at the end of the week, with EUR/USD still under pressure and hovering around the area of weekly lows near 1.1120.
A strong rebound in the dollar this week pushed the pair sharply lower from its 2023 high near 1.1270 on Monday (17/07/2023) to Thursday's (20/07/2023) lows in the 1.1120/15 band.
In addition to some profit-taking in light of the currency pair's recent strong gains, market talk suggesting that the Federal Reserve may not end its rate hike cycle in July has also boosted the dollar at the expense of risk assets.
Looking ahead, the EURUSD pair seems poised for some consolidation ahead of key Federal Reserve and European Central Bank (ECB) meetings this week. While both central banks are likely to raise rates by 25 basis points.
In addition, the Fed appears to be nearing the end of its monetary tightening cycle, while some ECB rate makers have sounded less hawkish lately about the prospect of further hikes after the summer.
Technical analysis. target around 1.1000 ?
The EURUSD currency pair is approaching the 1.1000 psychological threshold without any disputes. A break of this level could open the door to a potential return to the July 6 low of 1.08315 ahead of the key 200-day EMA at 1.077 and the May 31 low of 1.063. If the bulls prevail the currency pair could head to this year's highs of 1.1275 from July 18 and then, once broken, EURUSD has the potential to rise to the 2022 highs of 1.1495 when it reached those levels on February 10.
