EUR/USD increases volatility

Note: This section contains information in English only.
Source: Dukascopy Bank SA


The United States Federal Reserve has just published its Federal Funds Rate. As expected, the central bank has kept its base rate unchanged at 5.50%. The no change was expected.

The markets were looking forward to the follow up press conference of the Chairman of the Federal Reserve Jerome Powell. In general, the head of the central bank stated that there are no expectations of Fed Funds Rate cut. The only way the policymakers would ease the rate would, if something breaks. Namely, unemployment bounces above 4.0% or the banking sector crashes.

These comments caused a surge of the US Dollar that beat down the stock market. However, by mid-Thursday, a recovery was taking place in the market. The EUR/USD rate had returned back to 1.0880 and was expected to return to 1.0900.

A surge of the Euro against the US Dollar is set to face the resistance of the 1.0900 mark and the weekly R1 simple pivot point at 1.0918. Higher above, take into account the weekly R2 at 1.0985 and the 1.1000 mark.

However, a decline of the European currency against the USD is set to look for support in the weekly simple pivot point at 1.0865, the 200-hour simple moving average near 1.0850, the 50 and 100-hour SMAs in the 1.0820/1.0830 range, the 1.0800 mark and the weekly S1 simple pivot point at 1.0798. In addition, it appears that the prior resistance line has turned into a support line. In general, the pair has a lot of technical support.
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