EUR/USD: Fed decision holds the movement keyEuro vs. US DollarFX:EURUSDXBTFXThe main topic of the economic news for the U.S. economy were inflation figures. Inflation rate in May was 0,5% for the month and 4,3% on a yearly basis, matching market estimates. Core inflation remained relatively stable at 0,2% m/m and 2,9% y/y which was also in line with the market consensus. The Producers Price index in May was higher by 1,1% m/m, a bit higher from market expectations of 0,7% m/m. From other macro data posted for the U.S., Existing Home Sales in May reached 4,17M which represents an increase of 3,2% on a monthly basis. The figure was above market estimates of 0,5% m/m increase. Friday brought the University of Michigan Consumer Sentiment preliminary for June of 48,9, above expectations of 46. Preliminary inflation expectations dropped a bit to 4,6% from 4,8% estimated previously. The ECB increased interest rates by 25 bps at their policy meeting held during the previous week. As President Lagarde explained in a press conference, the decision was made in light of high insecurities originating from the U.S. - Iran conflict and unstable prices of oil. Analysts are noting probability for more ECB rate hikes during this year. However, Lagarde noted that future decisions will be data-dependent and discussed during every future meeting. There has not been any currently significant macro data posted during the week for the Euro Zone or its strongest economy - Germany. During the previous week the currency pair was moving in a relatively shorter range. The support level at 1,15 was shortly tested, while the market was favoring the upside. The highest weekly level was at 1,1590. There was no clear strength to test the 1,16 resistance. Friday brought a little pull back toward the 1,1570. The RSI started its move to the upside, closing the week at the level of 42. There is still no clear indication that it is ready to start a path toward the overbought market side. Moving averages of 200 and 50 days are still moving as two parallel lines, waiting a moment to make the cross. Charts are saying that the markets were quiet at this moment. They are waiting for the next trigger to find a new equilibrium point. The ECB increased interest rates which was a bit unexpected, now the question is what will Fed do at their meeting on Wednesday? In this sense, it could be expected that the movement “quietness” will continue until Wednesday, when the Fed, and its new Chair Warsh, will expose their view on current market conditions. At this moment, CME Fed WatchTool says 97% that there will be no change. The Fed's decision will finally trigger the market movement toward one side. Charts are currently pointing toward the 1,1440 down to 1,14 level. However, in case that market triggers the upside, then levels above the 1,16 will be tested. Most probably 1,1650 till 1,1680. Currently both sides have the equal probability of occurrence. Important news to watch during the week ahead are: EUR: Industrial Production in the Euro Zone in April, Inflation rate in the Euro Zone in May, USD: Industrial Production in May, Building Permits in May, Housing Starts in May, Retail Sales in May, FOMC meeting and Fed interest rate decision will be held on Wednesday, June 17th., Fed press conference.