Euro Is Moving Upwards, Taking Advantage of the USD Weakness
The reason why the USD is falling this week is the President Donald Trump’s aggressive rhetoric towards the US Federal Reserve. Trump said that he was absolutely unhappy with the key rate hike and Jerome Powell himself.
In fact, it doesn’t mean anything: it was Trump who assigned Powell to the Fed Chairman position, hence he approved Powell’s views on the country’s monetary policy. One should remember that Powel supports the monetary policy pursued by his predecessor, Janet Yellen, which proved to be efficient many times in the past.
However, the market is against the USD right now, because some speculative investors believe that Trump may one way or another have an impact on the US monetary policy. Moreover, it isn’t the first time Donald Trump criticized the Federal Reserve in such an aggressive manner of his, and that also makes investors nervous.
Apart from this, the USD is responding to the upcoming talks between China and the USA on their trade relations, which are expected to take place in the nearest future – before the end of this trading week.
In the H1 chart, EURUSD is forming an ascending tendency. The current uptrend is a correction of the previous long-term downtrend. The technical picture shows that the price has broken the resistance line of the previous rising channel and right now is trading above it, which means that the instrument may continue growing to reach the resistance line at 1.1580. After that, the pair may fall towards the support line at 1.1535. However, there is another scenario, according to which the price may soon break the current support level at 1.1500 and then continue trading to the downside to reaching 1.1460.
This article was written by Dmitriy Gurkovskiy, a Chief Analyst at RoboForex
This article was originally posted on FX Empire
