Hugo
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Hugo in HTO Trading,

EURUSD: Waiting for the big move one way or another. It’s coming.

The Federal Open Market Committee released its statement Wednesday afternoon. In a unanimous vote, the FOMC said that “the Committee judges that it can be patient in beginning to normalize the stance of monetary policy.” So no rate hikes any time soon.

On today economic calendar we have the preliminary Consumer Price Index (CPI) in January from the euro zone that is expected to fall from -0.2% to -0.5% showing that deflation is setting in the region. From the US that market is estimating a drop in the preliminary Gross Domestic Product in the 4th quarter from 5.0% to 3.3%.

EURUSD rose during yesterday session but found enough selling pressure around the 10-day moving average and close in the middle of the daily range. The stochastic is coming off the overbought zone and showing some bullish momentum. We might see the pair in a choppy sideways action between now and nonfarm payroll numbers next week.

Expecting downward move to a daily support at 1.1097 on a break below previous day low at 1.1261 (scenario 1) or a break above previous day high at 1367 could trigger a short squeeze and push the pair to a daily resistance at 1.1628.