EUR/USD wavers around 1.2400 ahead of US PCE

• Upside capped by USD rebound, higher T-yields.

• US core PCE data eyed for fresh impetus.

Amid resurgent USD demand across the board, the EUR bulls fail to survive at higher levels, leaving the EUR/USD pair wavering a narrow range around the 1.24 handle.

The spot continues to derive support from rising German yields, which track its US counterpart higher while the upside attempts remain in check on the back of the renewed uptick seen in the US dollar versus its major peers. The USD index swung back above the 89 handle, up +0.19% so far this session.

The sentiment around the greenback appears buoyed, as markets remain expectant of some hawkish language from the FOMC statement that will be published on Wednesday alongside the policy announcement.

Looking ahead, markets look forward to the US core PCE price index data due later today and the Eurozone flash CPI estimate slated for release this Wednesday for near-term trading opportunities ahead of the FOMC decision.

EUR/USD Technical Levels

Jim Langlands at FX Charts, notes: “With the short-term momentum indicators pointing lower, a run back towards 1.2370 would seem possible, below which there is Fibo support at 1.2310. With the daily/weekly charts looking positive though, any weakness may be short-lived and buying dips for the medium term trade would seem to be a plan. Above Friday’s high would then target 1.2538, beyond which would open 1.2650, albeit not today. In the meantime, the 100 MMA/200 MMA may provide stiff resistance, possibly until Wednesday’s FOMC Meeting.”