EURUSD Forecast And Technical Overview: The FED vs The President
“Federal Reserve Chairman Jerome Powell pushed back against perceptions that the U.S. economy was tilting into a recession while leaving the door open to further interest-rate cuts to keep the country’s record economic expansion on track.
Speaking Friday in Zurich, Powell said consumer spending and support from the monetary policy should help deliver economic growth between 2% and 2.5% this year. His remarks followed a mixed August jobs report and other readings on the economy that show the fallout from President Donald Trump’s trade disputes.”
“The most likely outlook for our economy remains a favorable one with moderate growth, a strong labor market and inflation moving back up close to our 2% goal,’’ Powell said during a question and answer session. “All that said, there are significant risks and we’ve been monitoring those, including slowing global growth, uncertainty around trade policy, and also persistently low inflation.”
- ECB is expected to go a stimulus expansion this month. The dimensions of the easing may be bigger than expected.
- Trump does not want strong USD, however, the FED does not seem to be dovish enough.
- The US CPI is expected to accelerate for the fourth consecutive month, hitting the highest level since July 2018 at 2.3 percent on-year. That might add support to DXY rally.
- Another issue is the trade wars. No significant development was seen so far. And there seems to be no further hope. The USD may also gain weight as a safe haven
- The latest decline in DXY appears to be just a technical correction. – I was expecting this correction as I published in my latest DXY analysis-
We have resold EURUSD at 1.10800. The bearish pressure will remain as long as the price holds below 1.11000.
If the price breaks above 1.11000, two bearish harmonic patterns will be waiting for us to use them as a selling opportunity.
Our near term targets are 1.10000, 1.09860, 1.09560, 1.09250.
Breakdown of 1.09200 support will accelerate the bearish move. Measured Move target of the formation is 1.08300.
Our focus is 1.08600. A daily closing below 1.08800 will trigger the global Dollar Rally. Our medium-term target levels for the EURUSD pair is 1.07500 and 1.06200.
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