The USD rose after retail sales exceeded expectations but later lost some gains. Traders are focused on the FOMC’s rate decision, expecting a 25 basis point cut. There’s also speculation that board members Miran, Bowman, and Waller might propose a larger 50 basis point cut. The EURUSD fell earlier, testing a key support level at 1.1788. This prompted buyers to step in. The pair then bounced back above 1.1800, continuing its upward trend. Traders are eyeing the July 1 high of 1.18289, as breaking this would mark the highest level since September 2021, potentially boosting momentum.

USDCHF Resistance Levels

The USDCHF dropped 0.53% today. It initially tried to rise after data was released but hit resistance between 0.7910 and 0.79209. Sellers stepped in, pushing the price below this area and refocusing on the 0.7900 level from July 3. If it falls below this, the next target will be the 2025 low of 0.7871, which was last seen in 2011. The USDCAD is down, struggling to hold onto its gains after retail sales data, sitting just below its 100-day moving average of 1.37626. Currently around 1.3750, the pair is at a crucial zone between 1.3743 and 1.3759. A drop below this range would further deepen the bearish outlook, targeting 1.3719 next. With the Federal Reserve’s rate decision coming up, there’s a lot of event risk to consider. August 2025’s Core PCE inflation data came in weaker than expected at 2.9%, supporting the case for the anticipated 25 basis point rate cut. Traders might want to use options to hedge against the chance of a more aggressive 50 basis point cut that could drive the dollar down even further.

EURUSD Breakout Potential

For EURUSD, the key level to watch is the July 1 high of 1.18289. Since Eurozone manufacturing PMIs showed slight improvement last month, there’s a solid reason to expect a breakout. Buying call options with a strike price just above this level could take advantage of a potential surge toward 1.2000, a level not seen since 2021. The weakness in USDCHF offers a clear bearish opportunity as it tests levels not touched since significant currency changes in 2011. The pair is nearing its 2025 low of 0.7871, a break here would be historically important. Buying put options could help profit from a move through this major support, especially if the FOMC signals a dovish stance. For USDCAD, failure at the 100-day moving average confirms that sellers are in control. The Canadian dollar is getting support from WTI crude oil prices, which have stayed above $88 per barrel throughout September 2025. This context enhances the bearish outlook for the pair, making strategies like bear put spreads appealing to target the 1.3719 level. Create your live VT Markets account and start trading now.

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