- FOMC member Raphael Bostic opened the door to a rate cut.
- The US Dollar soft off across the board and EUR/USD finally broke 1.1500.
- The pair has room to run as it does not suffer from overbought conditions.
Atlanta Fed President Raphael Bostic is a known dove, but he took one big bold step forward. He said interest rates could go in "either direction." So far, the Fed's intentions were to raise rates and perhaps only be "patient" as Chair Jerome Powell said. Suggesting a rate cut is a big step forward.
Another dovish FOMC member James Bullard of the Saint Louis Fed is considered the most dovish member and he said rates are "just right." So, Bostic out-doved the most dovish member.
The US Dollar was quickly offered across the board, and EUR/USD finally broke out of range, reaching a high at 1.1540, the highest since October 22nd. We ignore the abnormal levels seen around Christmas when the volume was extremely thin.
EUR/USD levels
-636826452321898738.png)
The first significant line of resistance is quite close: the October 22nd peak of 1.1550, which was a stepping stone on the way down.
Next, we find 1.1625 that was a cap on October 16th and also served as support beforehand. 1.1650 is close by and provided support on September 19th.
Further above, 1.1725 was a swing high in early August, and 1.1820 was a high point in mid-October. The very round 1.2000 looms overhead.
Looking down, 1.1500 turns into support. It is followed by the recent peak of 1.1485, 1.1440, and 1.1425.
The Relative Strength Index (RSI) is hardly above 50, allowing the pair room to run to the upside.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.