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Discussion points on the US dollar:
- The next two days are important, as many Fed speakers will comment on the Jackson Hole Economic Symposium. The main interest is the speech planned by FOMC President Jerome Powell on the economic calendar for 10:00 am Paris time but, as usual, each of these Fed speeches can prove that the market is moving considering the great importance of the FOMC policy at the moment.
- To not forget, political risks rise again in Italy. The euro remains in a range in the short term, but if the strength of the USD is shown after two days of drivers, the bearish theme of the EUR / USD could soon be at stake again.
- DailyFX forecasts are published on various markets such as Gold, the US Dollars or l & # 39; euro and are available from the DailyFX Page Guide. If you want to improve your business approach, consult Traits of successful traders. And if you're looking for an introduction to the Forex market, check out our New on FX Guide.
US Dollar Bounces on FOMC Minutes and Waits Fed-Speak
The US dollar pushed back this week's resistance following the publication of yesterday's FOMC minutes. It seemed obvious that the minutes of the meeting offered a potential downside, but this did not materialize, because the bank was largely considering the rate cut last month as a "mid-term adjustment". rate cuts and in response, the US dollar rebounded quickly from the 98.00 level to push resistance around the 98.37 zone.
Although the movement is very visible, it has also been relatively mild so far, indicating that much attention is expected on the refrain of Fed speakers ready to speak during the next two days. FOMC President Jerome Powell's speech at Jackson Hole tomorrow will be particularly interesting, and it looks like President Powell is having a hard time keeping the door open for rate cuts and additional mitigation, without triggering any alarms about impending recession signals. After the recent thickening of the tragedy around the reversal of the yield curve of US Treasury bills, global markets are rightly cautious, especially when the entire German yield curve has now moved into negative territory. Distortions abound and, for the moment, we do not know exactly how the Fed will manage future policy. The advice and speeches of the next two days will be critical to determining the merchant's price in this next direction.
Four-hour price table of the US dollar
Table prepared by James Stanley; US Dollars on Tradingview
Is the euro approaching a bearish break?
The Fed seems to have avoided the theme of future easing so far and hopes that Powell will ride the line of tomorrow's speech, sellers have started to test the short-term downside in EUR / USD again. In fact, if we get a net result from the strength of the US dollar in the absence of a promise to cut rates, the single currency could present a negative potential. The psychological level of 1.1000 is just below and has not been traded for two years.
There is a powerful cocktail of negative news around the euro, with last week's announcement of the ECB's potential stimulus to move ahead with the Italian political riddle. To date, sellers have not been able to change the ideas over the past week. But, given the events on the calendar of the next days, this potential does exist.
EUR / USD price table over four hours
Table prepared by James Stanley; EURUSD on Tradingview
GBP / USD grabs Trendline support to create a bearish flag
The month of August has so far seen the sudden downtrend of the GBP / USD slowing a bit. The pair's prices came up against a long-term trend line earlier this month and since then the bears have not been able to innovate much.
Monthly price table GBP / USD
Table prepared by James Stanley; GBPUSD on Tradingview
The continuation of the race for support has led to the creation of a bearish flag formation, which can help keep the door open to short-term strategies on the pair, especially for those looking for a net move of the USD strength around the Jackson Hole pilot. .
Price table in four hours GBP / USD
Table prepared by James Stanley; GBPUSD on Tradingview
USD / CAD test support avoids breakdowns
The impact on today's Canadian inflation has been surprisingly good, with a surprisingly strong surprise of 2% against a forecast of 1.7%. The immediate response in USD / CAD was a drop in the psychological level to 1.3250, which helped maintain support. but the sellers were unable to maintain control. Prices have since returned to support the previous trend line.
As reported in Tuesday's webinar, the USD / CAD exchange offers a potential for a turnaround. The pair had a strong downtrend in June and early July, reversing after the sellers failed to test the 1.3000 round again. This led to a retracement of one month with prices reaching 1.3345. If we see a break of this level 1.3250, the door is opened for a new test of versions 1.3200, 1.3132-1.3150, then 1.3066.
USD / CAD price table over four hours
Table prepared by James Stanley; USDCAD on Tradingview
AUD / USD: Shy sellers away from key support
Similar to GBP / USD above, a long-term level came into play, further restricting the theme in the near term. The AUD / USD is in strong downtrend since the beginning of last year. As early as 2019, the "flash" pair broke down until the .6750 level came into play, which resulted in lower prices for the rest of the transaction, like a beacon in the haze. This price began to be the subject of a new test of support early August, to finally yield temporarily under the effect of a dollar surge.
Monthly price table AUD / USD
Table prepared by James Stanley; AUDUSD on Tradingview
But this is the point where sellers have dried up and prices have started to rise. Since then, we have witnessed a re-emergence of this price because the support and the sellers have been unable to leave it behind. This support at a key level can leave the door open to bullish scenarios on the pair, especially for those looking for solutions to bring down the US dollar.
Price table in two hours AUD / USD
Table prepared by James Stanley; AUDUSD on Tradingview
To know more:
Are you looking for a longer term analysis on the US dollar? Our DailyFX Forecast have a section for every main currency, and we also offer a plethora of resources on Gold or USD-pairs such as EUR / USD, GBP / USD, USD / JPY, AUD / USD. Traders can also stay in step with short-term positioning via our Customer sentiment indicator IG.
Forex trading resources
DailyFX offers an abundance tools, indicators and resources to help traders. For those looking for business ideas, our Sense of the client IG shows the positioning of retail traders with real transactions and positions. Our commercial guides bring our quarterly DailyFX forecasts and our best trading opportunities; and our news feed in real time has intraday interactions of the DailyFX team. And if you're looking for real-time analytics, our DailyFX Webinars Submit many weekly sessions where you can see how and why we watch what we watch.
If you are looking for educational information, our New on the FX Guide is here to help new traders as our Research on the characteristics of successful traders is built to help refine the skill set by focusing on risk management and trading.
— Written by James Stanley, Strategist for DailyFX.com
Contact and follow James on Twitter: @JStanleyFX
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