EUR/USD weaker, eroding short-term support line near 1.1160

Fresh sellers continue to gather around the single currency today, now dragging EUR/USD to fresh 2-week lows in the 1.1165/60 band.

EUR/USD attention to US releases

The pair gathered further downside pressure, as the demand for the greenback stays firm in the second half of the week following further tightening from the Federal Reserve at yesterday’s meeting.

Recall that the FOMC hiked the Fed Funds target range to 1.00%-1.25% on Wednesday, matching consensus. In the same direction, the Committee revised lower its inflation forecasts for the current year, stressed that another rate hike remains on the cards and hinted that the reduction of the Fed’s balance sheet should start relatively soon.

After testing fresh 2017 tops just below 1.1300 the figure in the wake of poor US CPI figures for the month of May, spot quickly lost momentum and is currently down more than a big figure ahead of the upcoming US docket.

Furthermore, recent figures from EUR futures markets noted there could be room for further retracement in the near term.

EUR/USD levels to watch

At the moment, the pair is losing 0.49% at 1.1163 and a breakdown of 1.1157 (low Jun.15) would target 1.1108 (low May 30) en route to 1.1073 (76.4% Fibo of 1.1300-1.0339). On the flip side, the initial hurdle lines up at 1.1296 (2017 high Jun.14) seconded by 1.1300 (high Nov.9) and finally 1.1367 (high Aug.18 2016).

It is worth noting that the constructive stance remains intact as long as EUR/USD trades above the near-term support line, today at 1.1166. The bearish divergence in the daily RSI, however, seems to lend further support to a correction lower in the next weeks.