Brent oil is currently on a bullish trend, facing resistance near $84 and supported by the 200-day EMA. Breaking above this level could lead to a climb towards $90. Short-term support is observed around $80, backed by the 50-day EMA. As summer approaches and travel increases, crude oil tends to benefit from seasonal patterns. Despite temporary setbacks, buying...
Lagarde’s speech pushed EUR down
2020-09-30 • Updated
ECB’s President Christine Lagarde is planning to follow the Fed’s approach and allow inflation to overheat. The Federal Reserve earlier targeted the 2% inflation, letting it to overshoot.
Lagarde claimed: “If credible, such a strategy can strengthen the capacity of monetary policy to stabilize the economy when faced with the lower bound. This is because the promise of inflation overshooting raises inflation expectations and therefore lowers real interest rates.”
Although she hasn’t imposed this approach yet, the signal was quite strong. As a result, possibly lower rates reduced the demand for the euro. Elsewhere, the German Consumer Price Index came out worse than analysts expected yesterday, marking the sharpest slump in almost five years. As you know, Germany is Europe’s largest economy, that’s why this report worried investors and weighed so much on the euro. At the same time, intense debates between Trump and Biden deteriorated the market sentiment and underpinned the USD, especially after Trump refused to approve election results in case of Biden’s victory.
The risk-off sentiment pushed EUR/USD to the downside. It has shown the worst performance in six months last week. That’s why traders have doubts that the pair will stick to its long-term uptrend. The MACD indicator has crossed the zero line to turn negative, confirming a downtrend.
On the 4-hour chart we can notice that the pair has failed to break through the 50-period moving average at 1.1710. If it manages to drop below it, the way to yesterday’s low of 1.1675 and then to the next support of 1.1615 will be open. In the opposite scenario, if it rises above the key resistance of 1.1750, it will jump to a 100-period moving average of 1.1770.
Bearish Scenario: Sales below 78.99 with TP1: 77.93, TP2: 77.45, and upon its breakout TP3: 76.56 and TP4: 75.70 Bullish Scenario: Purchases above 78.00 (wait for a pullback to this area) with TP1: 1679.00 (uncovered POC*), TP2: 79.33, and TP3: 79.66 intraday
Bearish Scenario: Sales below 80.00 with TP1: 79.34, TP2: 78.94, TP3: 78.55, and 78.00 Bullish Scenario: Buys above 78.00 (wait for a retracement to the zone) with TP: 79.34 TP2: 80.00, and TP3: 81.00
The month of February saw markets make several instinctive moves as well as create opportunities for proper leveraging of fundamental releases. Despite being a leap-year, there wasn’t any real impact on price delivery in the course of the month. As we await the opportunities that lie ahead in the month of March, here are a few thoughts to consider.
USD/CHF saw a rebound after declining for two days straight, climbing towards the important psychological level of 0.8800 during Wednesday's early Asian trading session. There's some pressure on the Swiss Franc (CHF) as traders await the Swiss ZEW Survey – Expectations report scheduled for later today. Moreover, investors are keeping...
In the early hours of Tuesday, the US Dollar faces challenges in maintaining its strength against major currencies, with the US Dollar Index struggling to surpass the 104.00 mark. Investors are eagerly anticipating the release of key economic data, including January Durable Goods Orders and the Conference Board's Consumer Confidence Index for February. Additionally, the economic calendar includes reports...