Dollar Faces Pivotal Support as ECB Decision Looms Large
The US dollar is currently trading just above pivotal support at 98.68/69 on the DXY index, as it navigates a crucial week of event risk. The European Central Bank's interest rate decision and the release of U.S. PPI and CPI data will heavily influence market sentiment.
According to Michael Boutros, Sr. Technical Strategist at FOREX.com, a break or daily close below 98.68 would fuel the next major leg of the decline in the dollar's value. Conversely, a breach or daily close above the 38.2% retracement of the June decline at 99.80 would suggest a more significant low is in place and a larger trend reversal is underway.
The EUR/USD pair has defended its late-July uptrend, with the monthly opening range taking shape just above a key pivot zone at 1.1564/78. A break or daily close below this threshold would indicate a more significant high is in place and a larger trend reversal is underway.