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The pair of Euro / dollar currencies remained under pressure on Wednesday, at the heart of a week marked both per The semi -annual hearing of the boss of the Fed before parliamentarians, and by the publication, this day at 2:30 p.m. Consumer prices (CPI)one of the most direct measures of inflation.
Faced with a Senate commission yesterday, unsurprisingly, the central banker tempered on the potential decreases of key rates. “The economy is overall strong and has made significant progress towards our objectives in the past two years. We do not need to rush to adjust our monetary policy,” said the official, according to comments reported by Reuters. The official also abstained from any political comment linked to the Trump administration. Jerome Powell will be auditioned this Wednesday, this time before a commission from the House of Representatives.
To follow therefore with the greatest attention, this Wednesday, retail prices (ICC), or consumer prices across the Atlantic at 2:30 p.m. For the widest product basket, prices in January are expected, as an annual rate, up 2.9%.
“Consumer prices should remain close to 3% in annual variation,” anticipates Christopher Dembik, investment strategy advisor at Pictet AM. “It is a high level which is not consisting with new rate drops. It will certainly be necessary to wait from other more favorable statistics for the federal reserve to decide to lower its rates again. The rate of yield between the two edges of the Atlantic already causes consequences. It causes a downward pressure on the euro. This could also encourage part of the capital that are in Euro monetary funds to find refuge in dollar monetary funds, where the yield is higher. “
At midday on the foreign exchange market, the euro was treated against $ 1,0380 approximately.
Key graphics elements
The continuous 50 -day (in orange) mobile average constitutes a solid technical and graphic barrier. In the shorter term, it is even his counterpart at 20 days (in dark blue) that officiates as a dynamic resistance. And this without the RSI oscillator positioning itself in the occurrence zone. In the immediate future, the pair of currencies traces, in the upper part of the Bollinger bands, a negative structure in harami. Once the parity is perfect, namely $ 1 for a €, an energetic buyer of protest can then be set up.
Medium term
In view of the key graphic factors that we have mentioned, our opinion is negative in the medium term on Euro dollar parity (Eurusd).
Our entry point is 1,0379 USD. The price of course in our lowering scenario is 1,0001 USD. To preserve the capital committed, we advise you to position a protection stop at 1,0506 USD.
The profitability hope of this Forex strategy is 378 pips and the risk of loss is 127 pips.
The News Bulletin 247 Council
Daily data graphics
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