EUR/USD breaks below 1.09, session lows

The current pick up in the demand for the greenback is forcing EUR/USD to drop to the area of daily lows in sub-1.0900 levels.

EUR/USD focus on FOMC

The pair is reverting the positive mood seen at the beginning of the week following some optimism around the buck, with the US Dollar Index now regaining the key 99.00 barrier and looking to extend the bounce further north.

In the meantime, spot has surrendered the earlier spike to the vicinity 1.0930, as the lack of conviction from EUR-bulls and the imminence of the FOMC meeting (Wednesday) seem to have plotted against any sustainable bull run.

Regarding the meeting, consensus among traders seems to lie on the dovish side, although the likeliness that the Committee could discuss the timing of the reduction of the Fed’s balance sheet could give the buck some excuses for a move up and thus affect the pair’s rally.

EUR/USD levels to watch

At the moment, the pair is losing 0.03% at 1.0896 facing the next support at 1.0850 (low Apr.27) seconded by 1.0835 (200-day sma) and finally 1.0805 (23.6% Fibo of the April rally). On the flip side, a break above 1.0926 (high May 2) would target 1.0949 (high Apr.28) en route to 1.0951 (2017 high Apr.25/26).