By Gabriel Ojimadu, Alpari
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On Wednesday the 16th of August, trading on the euro closed in the black. The single currency was under intense pressure leading up to the release of the FOMC minutes. It first fell against the dollar after a report from Reuters that ECB president Mario Draghi wasn’t planning any significant monetary policy statement in the speech he’s set to give at the Jackson Hole symposium. Sellers later came into play after the publication of strong UK data.
When the US regulator published the minutes of its latest meeting, the dollar slipped and the euro rose. The minutes reveal that committee members are worried about weak inflation. Because of this, some members supported leaving rates unchanged for the time being until the situation becomes more clear. The euro/dollar rate ended up rising to 1.1779.
Day’s news (GMT+3):
EURUSD rate on the hourly. Source: TradingView
From its low of 1.1681, the euro has shot past the 45th and 67th degrees. Growth stopped around the 90thdegree. After a high of 1.1779, a bearish model has been forming over the last 11 hours. I reckon that the market will hit a new high of 1.1797 and then slip back to 1.1768. The rebound, of course, is not a foregone conclusion. The rate could move without hindrance as far as 1.1816 (112 degrees). In any case, buyers will start profit-taking around the trend line.
Free Reports:
The price is currently above the LB balance line. For the rally to continue, buyers need to actively defend 1.1745. Eurozone inflation data and the ECB’s monetary policy meeting accounts will act as the main drivers today.