By Veselin Petkov, Alpari
Yesterday evening, the US dollar got a boost from Fed Chair Jerome Powell’s speech, causing it to rise. The Fed Chair, citing solid economic growth and improving employment situation, made the case for continuing with the process of tightening monetary policy.
The way I see it, the following economic events could have an impact on currency exchange rates today:
- 11:30 (GMT+3) UK: CPI (Jun) – consumer prices are expected to a rise of 2.6% year-on-year.
- 12:00 (GMT+3) Eurozone: CPI (Jun) – year-on-year consumer inflation is expected to rise by 2.0%.
- 17:00 (GMT+3) USA: Fed’s Powell speech.
- 21:00 (GMT+3) USA: Fed’s beige book.
EURUSD:
On the 4-hour timeframe (H4), the EURUSD pair is forming the fifth wave inside the wedge (descending triangle):
At the time of writing, the EURUSD pair is moving towards the lower line of the wedge, which is located at around 1.1530.
On the hourly timeframe (H1), I believe that there’s potential for the beginning of a downwards trend:
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I reckon that barring any unforeseen circumstances, the EURUSD pair could drop as far as 1.1550.
The pair is currently trading at 1.16343; about 80 pips lower than yesterday morning.
