(News Bulletin 247) – Market psychology unchanged on the foreign exchange market, with a EURUSD spot still in a downward trend, but in a range that has been approaching a technical straitjacket since the start of the month, the two components of the pair remaining under pressure for different reasons. The Euro, a benchmark risk appetite barometer, remains on its guard with the spread of the Omicron variant which has prompted some countries in the Euro Zone to take new restrictive measures. The Dollar – and not only against the Euro – is brutally slowed down by the refusal of a senator to vote on the environmental and social aspect of the Biden stimulus plan.
On this last point, here is a brief reminder of the facts: a single Senator, (Democratic camp, West Virginia) Joe Manchin, blocks the vote on the BBB (Build Back Better) plan, a plan of more than $ 1,700 billion which includes major social and environmental aid and investment. It is “following this announcement” that “Goldman Sachs has decided to reduce its growth prospects for 2022 in the United States to 2% against 3% for Q1, 3% against 3.5% for Q2 and 2 , 75% against 3% for Q3 “, noted Vincent Boy.
This no is “definitive”, announced Joe Manchin on television … He thus alone blocks the vote, the Democrats not reaching the majority for this one. Indeed, 50 seats out of 100 are currently occupied by Republicans in the Senate. By counting the vote of Kamala Harris (Vice-President of the United States and President of the Senate according to the Constitution), the Democrats gather 50 votes … Except that Kamala Harris has the right to vote, only to decide in case of equality!
Joe Manchin’s firm NO to Joe Biden BBB reform plan is an extremely important political setback. First of all it was indeed a strong campaign pledge from the current president. Democrats are divided on whether to use public funds in the face of abysmal US debt. Finally, it could also question the Fed’s monetary decisions in the face of declining growth, a resurgence of Covid cases and a potential stabilization of inflation “, summarizes John Plassard (Mirabaud).
This Wednesday marks the return of macroeconomic benchmarks, with a battery of American publications this afternoon: final GDP data for Q3 at 2:30 p.m., the consumer confidence index (Conference Board) and sales of second-hand homes at 4:00 p.m. , as well as the rough stocks at 4:30 p.m.
At midday on the forex market, the Euro was trading against 1,1300$ about.
KEY GRAPHIC ELEMENTS
For now, the Euro / Dollar currency pair is still in the path of a wedge consolidation wedge, which fits into a strongly bearish background momentum. The configuration remains heavy, but we warn against the temptation of an early return to bearish positions, the “risk” of a false exit from the top, in the very short term, being present. We are still waiting for a much better entry point.
MEDIUM-TERM FORECAST
In view of the key graphical factors that we have mentioned, our opinion is neutral in the medium term on the pair Euro Dollar (EURUSD).
We will keep this neutral opinion as long as the price of the pair Euro Dollar (EURUSD) is positioned between the support at 1.1215 USD and the resistance at 1.1360 USD.
DAILY DATA CHART
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Source: Tradingsat
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