Eurusd Weak As Zew Data Awaited

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Eurusd Weak As Zew Data Awaited

Eur/Usd Weak Below 1.1150, Zew Data Awaited

EUR/USD is trading near 1.1150 on a weaker note on Tuesday as the US Dollar is experiencing a modest demand. The overall volume in the EUR/USD remains thin as everyone is on the sidelines ahead of the important Fed meeting tomorrow.

Also, Germany's ZEW data, along with the retail sales (US), is also due, which will also provide key insights into the economy.

Rsi Above 70 Hints At Correction

On the EUR/USD H4 chart, the RSI is above 70, which means the medium-term trend is still bullish. At the same time, it also hints at a possible technical correction before the pair can make a leg higher.

On the way down, the 23.6% fib retracement is also equally important, as even the 100 SMA is present near it! Both of these are present around the 1.1100 support area, which makes it an important level to watch.

Next up is the 1.1040 support area, which is where the 200 SMA and the 38.2% fib retracement are located. On the other hand, the first resistance for the EUR sellers will be 1.1160, and then the next one will be 1.1200. If the US Dollar bulls pierce through these 2 levels, the next stop will be 1.1275.

While the Federal Reserve will start its rate-cutting cycle, the ECB officials have recently given out hawkish comments. The ECB is also cutting rates, but these recent comments from officials seem to be supporting the Euro.

According to ECB Kazimir, a major shift in the economic data is needed before the ECB can commit to another rate cut in October. He also added that the next rate cut from the ECB will likely arrive in December.

Also, the ECB Philip Lane has also stressed the need to maintain rationality when it comes to making adjustments to the monetary policy.

The volatility will increase manifolds in EUR/USD tomorrow once the Federal Reserve's decision is officially released.

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