The EUR/USD pair shrugged off slowdown worries fueled by disappointing German IFO data. They stayed afloat on Monday as the US dollar struggled to find demand in a risk-positive environment.
At the time of writing, the shared currency trades at 1.0220, virtually unchanged since the weekly opening, after bouncing from a daily low of 1.0178 set during the European session.
Germany published July’s IFO Business Climate survey, which fell to 88.6, missing the market consensus of 90.5. The Current Assessment survey also came in worse than expected and stood at 97.7, while the expectations index contracted to 80.3, exacerbating recession fears in the eurozone.
Across the pond, the Federal Reserve Bank of Chicago published the Chicago Fed National Activity Index (CFNAI), which missed the market’s forecast and contracted to -0.19, fueling a dollar sell-off.
Ahead of Wednesday's FOMC meeting, the United States 10-Year note yield hovers around 2.8%. Markets are pricing a 77.5% probability of a 75 bps hike and a 22.5% chance of a 100 bps increase when the Fed gives its verdict on Wednesday.
According to the daily charts, the pair EUR/USD holds a short-term neutral bias as it struggles to consolidate above the 20-day SMA. The RSI trades with a positive slope below its midline, while the MACD prints higher green bars indicating a growing buying interest.
If the EUR/USD holds above the 20-day SMA, currently at 1.0226, the bulls could gain enough momentum to target the following resistance levels at 1.0300 and 1.0350. On the downside, supports are seen at 1.0200, followed by the 1.0100 zone and then the parity level.