Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

U.S. Dollar Could Rally Ahead of Important Economic Data

Published 02/21/2023, 02:04 AM
Updated 07/09/2023, 06:31 AM

The US Dollar Index is higher and keeps recovering since the strong US jobs data was reported for January and then also after worse-than-expected US CPI figures. Retail sales were also good for January so its seems that the fight against inflation is not done yet. Markets thinks that FED will have to be more aggressive, and some are even looking towards a 50bps increase on the next meeting.

So it's pretty simple; if economic data will keep coming out strong the dollar will be up, and stocks will be sideways or even bearish. So its very important to kee an eye on economic events and data. The next important numbers to watch will be PMIs today; it will be out for the UK, Europe and US.  AS well as  Existing Home sales later today, and then New Home sales for US on Friday.

Besides that there is FOMC meeting on Wednesday; a change in tone from Powell can shake the markets a lot. If we he will be hawkish we know that dollar will be up with US yields. On the other hand, if he will stick to previous comments then this will be seen dovish, and USD will most likely turn south.

From Elliott wave perspective we see EUR/USD in a higher degree correction after sharp turn down earlier this month, when price broke through the rising trendline support. Pair hit new lows then also at the end of last week,  but notice that the decline is not progressing at this stage, due to the holidays in the US. As such, we can see some slow down and choppy price action before the downtrend resumes, so ideally that's still wave (B) now in progress. 1.08 remains an important resistance for a turn down into (C) wave.

If you ware interested in more analysis check our video below.

EUR/USD 4-Hour Chart

Latest comments

yes
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.