EU discuss plans to cut gas consumption by 15%

EUR/USD Price May Fall towards This Level

 

• A trust issue with Mr Putin.
• Waiting for Mr Powell’s press conference
• EUR/USD critical levels to monitor

 
The EU held an emergency meeting yesterday to discuss plans to cut gas consumption by 15%. Leaders are skeptical about Mr Putin’s intentions of returning gas supplies to Europe as he said that he would not cut Europe 100% off from Russian gas.
Nonetheless, the lesson learned from the Ukrainian-Russian war gives the man a lower margin of credibility in Europe. Obviously, reducing energy consumption will have a bad effect on the European GDP and could hit growth levels negatively by 1.5% should these plans take place soon.
On the other side of the Atlantic, markets await the FOMC interest rate decision as the FED is expected to hike 75bp today. Investors will try to get more clarity tomorrow from Mr Powell about the central bank’s monetary policy while recession odds continue to rise due to two factors: a reduced corporate profit outlook and the fall in consumer sentiment.
 
EUR/USD Price Daily Price Chart

 
On July 14, EUR/USD fell to a near 20-year low at 0.9952 then rallied after as some traders took profits. The pair tested 1.0250 on multiple occasions however failed to close above.
Currently, the price moves in the trading zone 1.0000 - 1.0414. A daily close below the low end of the aforementioned trading zone could encourage bears to press the price towards 0.9701. On the other hand, a break above the 21 July high at 1.0277 could send the price towards the high end of the trading zone.