(News Bulletin 247) – The Euro continued its consolidation phase, not without nervousness around $1.0350, in a foreign exchange market focused on monetary policies on both sides of the Atlantic and the social situation in China .
“The markets are attentive to the speeches of the central bankers, more particularly to the indications as to the target of the terminal rate and to a pivot of the monetary policies”, for the strategists of ABN Amro. But the latest Fed Minutes, if they suggest a slowdown in the rate of increase in Fed Funds, say nothing about the terminal rate, this point of arrival at the top of the course. from 5% to 7%, the extreme margins mentioned by James Bullard.
See you at 7:30 p.m. (Paris time) for an important speech by J Powell, Chairman of the Fed, who will present his economic outlook, in particular on inflation and the labor market at the Brooking Institution (Washington DC).
The Euro, the quintessential risk appetite barometer currency, is influenced by the ebb and flow of fears over claims (protest, dare we say it!), sometimes spilling over into clashes with the police, a fringe of the population exasperated by the radical nature of the anti-Covid laws.
The Chinese authorities have however announced that they will accelerate the vaccination of the elderly against Covid-19, while the low vaccination rate among this population is one of the arguments used by Beijing to justify its zero-Covid policy.
“The party could give in to the population and soften the anti-covid measures and in particular the zero case policy, in place in the country for far too long now”, wants to believe Vincent Boy (IG France). “Furthermore, the announcements of new support for the real estate market enabled the indices in China and Hong Kong to rise sharply at the end of the session. [hier] morning.”
In terms of statistics yesterday, it was the consumer confidence index (Conference Board) that focused the attention, without however deviating significantly from the target, contracting to 100.2 points.
At midday on the foreign exchange market, the Euro was trading against $1.0360 about.
KEY GRAPHIC ELEMENTS
Volatility remains high on the spot which traces a broad consolidation, whose structure remains to be defined, around $1.03. A continuation of these nervous oscillations is the preferred option, an unattractive graphic scenario for taking positions. We would prefer to stay out of the spot for the time being. The flag terminals are clearly marked, between 1.0240 and $1.05.
MEDIUM TERM FORECAST
In view of the key graphic factors that we have mentioned, our opinion is neutral in the medium term on the Euro Dollar (EURUSD).
We will maintain this neutral opinion as long as the Euro Dollar (EURUSD) parity prices are positioned between the support at 1.0175 USD and the resistance at 1.0484 USD.
CHART IN DAILY DATA
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