The Greenback puts pressure ahead of key FOMC meeting
- Since October 2023, the decreased appetite for the US Dollar, particularly due to hopes of a more dovish monetary policy in the United States, has allowed the Euro to regain ground.
The EURUSD then traded in a bullish channel until the end of 2023, until 1.1141, the trend was therefore bullish in the medium term.
- However, since the start of 2024 and the fading of hopes of quick rate cuts in the United States, the US Dollar has strengthened significantly against the single currency. This situation led the market to invalidate the uptrend by breaking out the bullish channel.
The bearish crossover of the Tenkan and the Kijun, the bearish Switch of the Ichimoku cloud as well as the breakout of prices, the tenkan and the kijun by the Chiko Span send a clearly bearish message.
- That said, the strong 50% Fibonacci support at 1.0795 is now really close, and investors are also awaiting a crucial FOMC meeting this week.
A hawkish semantics from the FED would be likely to extend the dbearish movement of the EURUSD even lower towards 1.0714, 1.0600 or even 1.0450 by extension.
On the other hand, if Jerome Powell were to adopt a more dovish tone by talking about potential future rate cuts, a strong market rally could take place above the current 50% Fibonacci zone at 1.0795.
What is certain is that volatility will increase sharply this week on this pair.
To be continued...
The information provided does not constitute investment research. The material has no been prepared in accordance with the legal requirements designed to promote the independence of investment research and such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
The EURUSD then traded in a bullish channel until the end of 2023, until 1.1141, the trend was therefore bullish in the medium term.
- However, since the start of 2024 and the fading of hopes of quick rate cuts in the United States, the US Dollar has strengthened significantly against the single currency. This situation led the market to invalidate the uptrend by breaking out the bullish channel.
The bearish crossover of the Tenkan and the Kijun, the bearish Switch of the Ichimoku cloud as well as the breakout of prices, the tenkan and the kijun by the Chiko Span send a clearly bearish message.
- That said, the strong 50% Fibonacci support at 1.0795 is now really close, and investors are also awaiting a crucial FOMC meeting this week.
A hawkish semantics from the FED would be likely to extend the dbearish movement of the EURUSD even lower towards 1.0714, 1.0600 or even 1.0450 by extension.
On the other hand, if Jerome Powell were to adopt a more dovish tone by talking about potential future rate cuts, a strong market rally could take place above the current 50% Fibonacci zone at 1.0795.
What is certain is that volatility will increase sharply this week on this pair.
To be continued...
The information provided does not constitute investment research. The material has no been prepared in accordance with the legal requirements designed to promote the independence of investment research and such is to be considered to be a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
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