EUR/USD Hits 1.146 Support as Hawkish FOMC Drives Dollar Strength
Euro falls to 1.146 after hawkish Fed meeting. ECB rate hike and US jobs data now determine direction.
Key points
- EUR/USD falls to 1.146 after a hawkish FOMC meeting strengthens the dollar.
- A break below 1.146 could push the pair toward 1.135 or even 1.128.
- The ECB raised rates by 25 basis points as Eurozone inflation risks persist.
EUR/USD has dropped to 1.146, a critical support level. This decline follows a hawkish Federal Reserve meeting that strengthened the US dollar significantly.
The pair now sits at its lowest point since July. Traders watch this zone closely because a break could trigger further losses toward 1.135.
Hawkish Fed drives dollar rally
Market participants view the recent FOMC decision as more aggressive than expected. This shift has pushed the dollar to a one-year high against the euro.
CMC Markets notes that the euro remains vulnerable under this pressure. The currency pair faces significant downside risk if current support levels fail to hold.
Technical levels define near-term path
The 1.146 level formed in June and acted as resistance in July. Breaking this floor would likely send the pair toward the 1.135 lows from earlier this year.
A further drop below that level could expose the euro to 1.128. Conversely, holding 1.146 could allow a rebound toward the 1.16 area.
ECB hike complicates the outlook
The European Central Bank recently raised rates by 25 basis points. This action comes amid rising inflation fears and slowing economic growth in the Eurozone.
European equities and the euro remain sensitive to future policy signals. Upcoming US jobs data will also test the durability of the dollar's recent strength.
