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| EUR/USD four-hour chart, source:FXDD.com |
cf. [EUR] Recovering Euro 2020 0302
cf. [EUR] Between the technical rebound and upward trend 2020 0226
cf. [EUR] Expecting Euro Recovery 2020 0223
One of the major currency, EUR/USD began to rally since February 20 and is under the correction after Fed's big shot on Tuesday.
The daily chart gives clue, euro moves along upper band of Bollinger Bands after succeeding of reaching the band. The negative candle after some positive candles supports that the retreating is the correction for more rising. We can have long bias to euro.
Hours charts send signal of downward trend. One-hour chart may build triple-tops pattern and double-tops pattern in four-hour chart. The down-turn pattern was not built yet, and the signal may be noise.
But we need to watch the chart carefully and check the momentum of euro, rebounding signals.
The currency pair can set support line at 1.1100 first and 1.1070 second.
One of the powerful event, Non-Farm Payrolls is released on this Friday. Market expects 175-thousand increase. The previous record was 225-thousand increase.
Euro has passed the edge of triangle pattern upward. It broke through 1.11, but faced the correction as Federal Reserve cut the benchmark rate 0.5 percent point to 1.0~1.25 percent on Tuesday. FOMC is planned to be held two weeks later and market participants expected Federal Funds Rate would be cut 0.25 percent point at the meeting. Someone predicted Fed would do before FOMC meeting.
On the contrary the ordinary response, equities in New York plunged. Because the market thought the economy situation was worse and Fed did big cut.
The expectation of other central bank's interest-rate cut made greenback to rise against euro and yen on Wednesday. Dollar index, dollar's value against the basket of six major currencies rose to 97.36 in five days.
The major market participants anticipate more benchmark-rate cut and predict euro to rise. The key rate in euro zone is zero percent, but the deposit rate is already negative, ECB has less cards to stimulate euro-zone economy. And some economist expect EUR/USD to 1.15 in the second quarter, economy news wire, Yonhap Infomax reported on Wednesday.
Gjallarhorn has still long position of euro..
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