EUR / USD turns back after reacting with an initial rally to Powell’s words

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He EUR/USD It initially reacted upward to the comments that Fed Chairman Jerome Powell made at an online event organized by the Princeton Bendheim Finance Center. The pair has risen more than 25 pips on his words, reaching highs for the day at 1.2178. Subsequently, the pair has lost all the ground gained, falling towards the vicinity of 1.2150

At time of writing, the euro / dollar pair is trading around 1.2155, just gaining 0.01% on the day.

The DXY index that measures the greenback has also initially fallen, sliding to a daily low at 90.07, but has since recovered the 90.25 zone.

Powell’s key comments

Jerome Powell has started by saying that the US is still a long way from peak employment and the time to raise interest rates is not near. Subsequently, he has changed the record to a more optimistic tone, pointing out that “if we do our job well, that will encourage the creation of safe assets and the use of the dollar as a reserve currency.” In addition, he has indicated that “we can return to a strong labor market sooner than we feared.”

EUR / USD levels

If you keep going backwards, the first support is at 1.2110, today’s low, followed by the 1.2100 zone. If it breaks below, the fall may extend to 1.2058, the December 9 floor.

Upward, the first bullish target is 1.2222, January 13 high, en route to 1.2284 resistance, January 8 high. Higher up expects 1.2349, a maximum of January 6 and the highest level reached since April 2018.

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