EUR/USD Mid-Session Technical Analysis for September 28, 2021

The Euro is trading lower against the U.S. Dollar on Tuesday as investors continued to fret about when central banks might tighten monetary policy. Although Euro Zone bond yields rose to their highest levels since early July, they could not catch up to the U.S. Treasury yields that were rising at an even faster pace. The widening of the interest rate differential continue to make the U.S. Dollar a more attractive asset.

At 11:24 GMT, the EUR/USD was trading 1.1683, down 0.0013 or -0.11%.

Bond yields on both side of the Atlantic have been on the rise since U.S. Federal Reserve policymakers last week projected that they are ready to raise rates in 2022 and that the bank is likely to begin reducing its monthly bond purchases as soon as November.

In economic news, European Central Bank President Christine Lagarde is expected to give a speech at 12:00 GMT, but all eyes will probably be on Federal Reserve Chairman Jerome Powell, who is due to speak before the U.S. Senate at 14:00 GMT. Investors will likely be listening for clues as to when the Fed plans to reduce its bond-buying program.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through the August 20 main bottom at 1.1664 will reaffirm the downtrend. A move through 1.1755 will change the main trend to up.

The minor range is 1.1755 to 1.1672. Its 50% level or pivot at 1.1713 is potential resistance.

Additional resistance is the price cluster at 1.1755 to 1.1758.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD into the close on Tuesday will likely be determined by trader reaction to 1.1696.

Bearish Scenario

A sustained move under 1.1696 will indicate the presence of sellers. If this move generates enough downside momentum then look for a test of 1.1664.

Buyers could come in on the first test of 1.1664, but if it fails as support then look out to the downside with the next major target the November 4, 2020 main bottom at 1.1603.

Bullish Scenario

A sustained move over 1.1696 will signal the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the pivot at 1.1713.

Since the main trend is down, look for sellers on the first test of this level. Overcoming it, however, will indicate the buying is getting stronger. This could trigger an acceleration to the upside with 1.1755 to 1.1758 the next likely upside target area.