The USD experienced a rise following better-than-expected retail sales, though it later surrendered some of those gains. Current attention is on the FOMC rate decision, with a 25 basis point cut anticipated. There’s speculation concerning if a 50 basis point cut could be advocated by board members Miran, Bowman, and Waller.
The EURUSD depreciated earlier, testing the high of a crucial support level at 1.1788, which encouraged dip buyers to act. Subsequently, the pair rebounded above 1.1800, maintaining an upward trend. Traders are watching the July 1 high of 1.18289, as surpassing this would mark the pair’s highest level since September 2021, potentially leading to sustained momentum.
Usdchf Resistance Levels
The USDCHF saw a drop of -0.53% for the day, initially attempting a rise after data release but was halted at the resistance between 0.7910 and 0.79209. Sellers moved against this ceiling, causing a retreat below the zone, shifting focus to the 0.7900 level from July 3. Falling below this would target the 2025 low of 0.7871, a significant point last reached in 2011.
The USDCAD is down, failing to maintain a rebound post-retail sales, against its 100-day moving average at 1.37626. Currently near 1.3750, the pair faces a crucial area between 1.3743 and 1.3759. A breach below this would deepen the bearish outlook, targeting 1.3719 next.
With the Federal Reserve’s rate decision imminent, we see significant event risk on the table. August 2025’s Core PCE inflation data came in softer than anticipated at 2.9%, bolstering the case for the expected 25 basis point cut. Traders should consider using options to hedge against the possibility of a more aggressive 50 basis point cut, which would accelerate the dollar’s recent decline.
The Eurusd Breakout Potential
For EURUSD, the critical level to watch is the July 1 high of 1.18289. Given that Eurozone manufacturing PMIs showed a slight improvement last month, there’s a fundamental reason to believe a breakout is possible. A strategy of buying call options with a strike price just above this level could capitalize on a potential surge toward the 1.2000 mark for the first time since 2021.
The pronounced weakness in USDCHF presents a clear bearish opportunity as it tests levels not seen since the major currency shifts of 2011. The pair is approaching its 2025 low of 0.7871, a break of which would be historically significant. We see value in purchasing put options to profit from a move through this major long-term support, especially if the FOMC delivers a dovish message.
In the case of USDCAD, the failure at the 100-day moving average confirms sellers are in control. The Canadian dollar is receiving support from WTI crude oil prices, which have remained consistently above $88 per barrel throughout September 2025. This backdrop reinforces the bearish outlook for the pair, making strategies like bear put spreads attractive to target a move toward the 1.3719 level.
