The EURUSD pair extends the ascent on Tuesday, hovering around fresh three-month highs above the 1.14 handle. The euro is rising for a fifth day in a row, with the main bullish driver is a broad-based weakness in the greenback.
Despite the pair starts to show some overbought conditions, the common currency could refresh local highs in the short term as Powell could confirm its dovish tone in today’s statement. In this case, traders will continue to price in a rate cut by the Federal Reserve and to exit USD longs, accumulated earlier.
Besides, the additional upside pressure on the single currency may come from potentially weak US data including consumer confidence. If so, EURUSD will target 1.1425. But another bullish breakthrough will only be confirmed on a daily close above 1.14. Anyway, both fundamental and technical picture continues to point at euro strength, at least in the short term.