KEY POINTS:The Fed delivers on expectations, but Powell sounds more dovishThe ECB is expected to keep everything unchanged as they maintain a neutral stanceEURUSD extends above a key swing level, opening the door for new highsFocus centres on US NFP and CPI reports this weekFUNDAMENTALOVERVIEWUSD:The USD has been weakeningacross the board since last week’s FOMC decision. The Fed delivered onexpectations cutting by 25 bps and signalling a higher bar for further ratecuts, but Fed Chair Powell’s press conference was seen as fairly dovish. In fact, instead ofsounding as neutral as possible and stressing data-dependency, he downplayedthe inflation risk and emphasized the labour market weakness, suggesting thatthere’s more tolerance for higher inflation than for weaker labour market. The focus this week will beon the US NFP and CPI reports that will wrap up the last real trading week ofthe year before market participants prepare for the holidays. Right now, themarket is pricing 57 bps of easing by the end of 2026. If we get strong US data,especially on the labour market side, we will likely see a hawkish repricingwhich would give the US dollar a boost. On the other hand, weak data shouldweigh on the greenback further as the market will bring rate cut bets forward. EUR:On the EUR side, the ECB iswidely expected to hold interest rates steady and refrain from giving away toomuch forward guidance. The ECB members have repeatedly said that the currentpolicy is appropriate, and they won’t respond to small or short-term deviationsfrom their 2% target. Moreover, they added thatthe next moves could be either a cut or a hike. The data has been supportingthe central bank’s neutral stance, and the market has even started to price insome chances of a hike next year.EURUSD TECHNICALANALYSIS – DAILY TIMEFRAMEOn the daily chart, we cansee that EURUSD broke above the major swing level at 1.1728 opening the doorfor a move into the 1.1778 level next. From a risk management perspective, thebuyers will have a better risk to reward setup around the major trendline to positionfor a rally into new highs, while the sellers will look for breaks below thekey levels to keep piling in for new lows.EURUSD TECHNICALANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we cansee that the price has been consolidating just above the 1.1728 level recently.The buyers will likely continue to step in around the 1.1728 level to keeppushing into the 1.1778 level, while the sellers will look for a break lower totarget a deeper pullback into the major trendline.EURUSD TECHNICALANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, we can see more clearly the tight range between the1.1728 support and the 1.1750 resistance. The market participants will likelycontinue to play the range until we get a breakout on either side. The redlines define average daily range for today. UPCOMING CATALYSTSTomorrow we have the Eurozone Flash PMIs and the US NFP. On Thursday, we havethe ECB rate decision and the US CPI data. This article was written by Giuseppe Dellamotta at investinglive.com.