The EURUSD pair failed to make a clear break above the 20-DMA and remained below the key 1.17 barrier. The price has resumed the downside move today, with stronger-than expected euro zone service PMI haven’t provided a boost to the pair. This confirms that the general USD sentiment remains the main driver for the pair for the time being.
The downside pressure on the euro could increase should the release of minutes of the Federal Reserve’s June 12-13 policy meeting provide further hawkish clues. The risk for the dollar is the potentially more cautious tone by the Fed amid the escalating trade tensions between the US and its trading partners. The base case scenario implies that EURUSD will further lose ground by the end if this week and derail the 1.16 support once again.