(News Bulletin 247) – While macroeconomic benchmarks are lacking on Tuesday, before their comeback tomorrow with US inflation, the technical straitjacket towards $ 1.13 continued to grip very firmly a EURUSD spot subjected to antagonistic forces : on the one hand, the prospect of a stronger and earlier than expected tightening of American monetary policy opens for the greenback while the relief around the dangerousness of the “Omicron” variant day for the single currency, one choice barometer of risk appetite in financial markets.
“The much less accommodating tone of the Fed confirms the acceleration of the current monetary tightening. The Federal Reserve should continue to reduce its asset buybacks until March and could, as early as the same month, announce a first rate hike. The probability of seeing an increase at the March meeting is now 79.2%, according to CME’s Fed Watch. It was only 35.8% a month earlier. “notes Vincent Boy (IG France ). The increased “earnings potential” between the two components of the currency pair is clearly in favor of the greenback.
It will be interesting to gauge the temperature of consumer prices tomorrow, after minutes offensive to say the least last week, and an employment report showing persistent signs of tension. Verdict tomorrow 2:30 p.m. with the CPIs. Excluding food and energy, prices are expected to increase by 0.5% for the month of December, on a monthly basis.
In the statistical chapter yesterday, good news to report concerning the Sentix index of confidence of operators in the Euro Zone, which beat expectations by approaching 15 points. RAS concerning the unemployment rate in the Euro Zone, which continues to decline as expected, to 7.2% of the working population, the lowest since … July 2008.
At midday on the forex market, the Euro was trading against 1,1330$ about.
KEY GRAPHIC ELEMENTS
For now, the Euro / Dollar currency pair is still in the course 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 top exit, in the very short term, being present. We are still waiting for a much better entry point. Beware of action bias, a cognitive bias that sometimes pushes decision-making to be overvalued rather than procrastination, inaction or reflection.
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 1.1216 USD and the resistance at 1.1360 USD.
DAILY DATA CHART
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Source: Tradingsat
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