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EURUSD | Strong US Dollar, But Why?The value of the US dollar continues to rise Today on September 30, one Euro cost only $1.0573 and markets have finally come to the realization that the Federal Reserve is going to continue to fight inflation till it achieves its target goals, and, to do so, it will even raise its policy rate of interest one..or, possibly two...more times! even Jamie Dimon, CEO of JPMorgan, is now saying that interest rates could hit 7.0 percent. "Are you prepared?" Dimon asks It seems as if market participants have doubted Fed Chairman Jay Powell ever since the Federal Reserve began to raise its policy rate of interest in the middle of March 2022.The underlying belief was that Mr. Powell and the Fed would "back off," not wanting to overdue a tight monetary policy and cause financial distress. So, the value of the U.S. dollar remained softer than many expected and the US stock market stayed stronger than many expected.But, seemingly, that time has changed. When did market attitudes change? Let's say toward the end of July 2023. That is, market participants only became "believers" after 16 months of the Federal Reserve raising its policy rate of interest and maintaining its effort at quantitative tightening. Why have I determined that market attitudes changed around the end of March? On July 14, 20232, one Euro cost $1.1230. The price of one Euro has declined almost steadily since that time.The dollar price of the British pound took a similar path.The yield on the 10-year U.S. Treasury note on July 14, 2023, was 3.820 percent. Currently, the yield is 4.620 percent. On July 31, the S&P 500 stock index closed at 4,589. The price has been downhill for most of the following period.The story that the markets seem to be telling us is that sometime in the middle of July 2023, market participants started taking the Federal Reserve at its word. Since then, the value of the U.S. dollar became stronger and stronger, as investors bought into the dollar.Bond prices fell and stock prices declined as investors sold these items. All of this is consistent with the fact that investors really started to believe that Mr. Powell and the Federal Reserve were going to do what it said it had set out to do.The Fed, market participants believed, going to continue to fight inflation and were going to bring the rate of price increases down to the level the Fed wanted...2.0 percent. In this past week, the Federal Reserve published its latest round of forecasts for the future. This release was followed by a new set of forecasts by the U.S Commerce Department. inflation and unemployment would approach the Fed's goals within the next year or so. The feeling expressed in both forecasts was that the Fed is succeeding in its efforts to get the economy back to a "more normal" rate of operation. Mr. Powell and other Federal Reserve leaders continued to caution the investment community to "be patient." But, the underlying message seemed to be, we are approaching what we set out to achieve. Bottom line, Mr. Powell and others were saying...be patient...after 18 months of quantitative tightening..we are getting there.It seems as if the markets have been right on the side of the Federal Reserve at this time. What the Fed has done supports a strong dollar relative to other currencies throughout the world.The US dollar deserves to be strong.But, there is still a way to go. The Fed may be getting the car in the garage, but the car is not fully in the garage yet...and the garage door has not been shut.Let's hope the job can be completed. Unfortunately, there may be some fiscal discomfort taking place before the final chapters are written. The potential government shutdown is not good news.
by moonypto
EUR/USD: LIKELY TO BOUNCE BACK.Hello traders, Here's another update on EUR/USD in a 3-hour timeframe. After a continuous drop in the EUR/USD, it has finally reached close to the previous support level ($1.052). This area is going to be crucial for the EUR/USD to decide where it will head next. As far as I am concerned, the EUR/USD must bounce back soon. The invalidation point will be a close below $1.052. What's your idea on this chart? Let me know in the comments. Regards, Team Dexter.
Long
by Dexter_The_Trader
3
EUR/USD: Euro Trims Losses Against US Dollar Post-Fed EventEuro Trims Losses Against US Dollar Post-Fed Event In the aftermath of the recent Federal Reserve (Fed) event, the Euro (EUR) found itself on a backfoot against the US Dollar (USD), but it managed to regain some ground. Here's a look at the key events and dynamics shaping the EUR/USD currency pair's movement. Euro in Decline Post-Fed: The Euro had been facing downward pressure against the US Dollar as the market digested the implications of the Federal Reserve's recent actions. Stocks in Europe opened Thursday's trading session in the red, reflecting a cautious sentiment in the market. EUR/USD Rebounds: Despite an early drop to fresh multi-month lows, the Euro managed to stage a modest rebound against the US Dollar. As a result, the EUR/USD pair climbed back above the 1.0650 level during the European trading session on Thursday. US Dollar Strength Persists: The US Dollar continued to demonstrate strength, with the USD Index (DXY) reaching new highs. The index approached a six-month high near 105.70, just a few pips away from the year-to-date peak observed on March 8, which was around 105.90. Fed's Hawkish Stance: The rebound in the EUR/USD pair coincided with some corrective movements in the short end of the US yield curve, while the belly and long end saw modest gains. This shift in bond yields may have contributed to the Euro's rebound. Following the Fed's meeting, Chairman Jerome Powell emphasized that there is still a considerable path to cover in reaching the target inflation rate of 2%. The Fed decided to maintain current interest rates, but it remains prepared to raise rates when it deems appropriate. Key Data and Events Ahead: In the economic calendar for the eurozone, the preliminary reading of Consumer Confidence, tracked by the European Commission, is scheduled for release. Additionally, ECB President Christine Lagarde is expected to deliver a speech, which could provide insights into the central bank's perspective. In the United States, the focus will be on the usual weekly Initial Jobless Claims data, followed by the Philly Fed Manufacturing Index, the CB Leading Economic Index, and Existing Home Sales. These data points will provide further context for the economic situation in the US. In summary, the Euro faced early losses against the US Dollar but managed to regain some ground in European trading. The USD's strength persists, with the Fed maintaining a hawkish stance. Key economic data and speeches by central bank officials will be closely monitored for further market direction. Our preference Short positions below 1.072 with targets at 1.0610 & 1.0590 in extension.
Short
by FOREXN1
7
ECB's Next Move in Inflation Fight: Managing Excess Liquidity Frankfurt, Reuters - In the ongoing fight against inflation, European Central Bank (ECB) policymakers are gearing up for a significant shift in strategy. They are set to deliberate on ways to address the vast pool of excess liquidity inundating banks, with the possibility of raising reserve requirements emerging as the initial tactic. This pivotal discussion is expected to kick off at the ECB's forthcoming meeting in Athens on October 26 or during an autumn retreat for policymakers. Despite the ECB having already raised interest rates ten times to record levels, inflation still stubbornly hovers above its 2% target. With interest rates likely to remain unchanged until December, policymakers are pivoting their attention to the massive infusion of funds into the banking system through a decade of bond purchases. This surplus liquidity undermines the effectiveness of rate hikes, reduces competition for deposits, and leads to substantial interest payments and potential losses for some central banks. Sources indicate that the debate on curbing excess liquidity will focus on three key areas: revising the mandatory reserves banks maintain at the ECB, unwinding the bond-buying programs, and establishing a new framework for influencing short-term interest rates. While an ECB spokesperson declined to comment, insiders suggest that several policymakers favor increasing the reserve requirement from the current 1% of customer deposits to potentially as high as 3% or 4%. This move would serve the dual purpose of absorbing excess cash from the banking system and reducing interest payouts by the ECB and the eurozone's national central banks. However, some policymakers advocate bundling the decision on reserves with discussions regarding the ECB's asset purchase schemes and interest-rate framework, which could lengthen the decision-making process. Shrinking the 4.8 trillion euro debt pile acquired by the ECB since 2015, mainly to counter deflation risks, poses even greater challenges and market sensitivities. While phasing out the ECB's Pandemic Emergency Purchase Programme (PEPP) by not replacing maturing bonds is an option, policymakers are cautious about upsetting financial markets, particularly Italian government bond investors. ECB President Christine Lagarde recently indicated that bond-buying schemes were not on the table at the latest policy meeting, emphasizing the importance of PEPP for policy transmission. While there have been suggestions to sell bonds acquired under the older Asset Purchase Programme, some argue this would result in even larger losses for the ECB. Sources suggest that a decision on bond-buying schemes might not materialize this year and, if it does, may not take effect until early 2024 or later in the spring. Furthermore, debates surrounding the policy framework—whether the ECB should continue to set an interbank rate floor or revert to a corridor system—are expected to extend into 2024, as the volume of excess reserves in banks keeps the ECB effectively locked into a floor system. A study presented at the ECB's summer symposium in Sintra suggested that, now that monetary stimulus is no longer necessary, the ECB could reduce bank liquidity to a range of 521 billion euros to 1.4 trillion euros while still meeting banks' reserve needs." This revised text provides a more engaging and concise summary of the original content, making it more attractive to readers.
by Ayame_Hana
53
Global debt hits record $307 trillion, debt ratios climb -IIFGlobal debt reached a record high of $307 trillion in the second quarter, despite higher interest rates limiting bank lending. The United States and Japan were the main drivers of this increase, according to the Institute of International Finance (IIF). The IIF's report revealed that global debt in dollar terms rose by $10 trillion in the first half of 2023 and by $100 trillion over the past decade. This surge in debt has pushed the global debt-to-GDP ratio to 336% for the second consecutive quarter. The report attributes this rise to a slowdown in economic growth and price increases, resulting in nominal GDP expanding at a slower pace than debt levels. Emre Tiftik, Director of Sustainability Research at the IIF, noted that the debt-to-GDP ratio is once again increasing after declining for seven consecutive quarters, mostly due to easing inflationary pressures. The IIF expects the debt-to-output ratio to surpass 337% by the end of the year, as wage and price pressures continue to moderate. Experts and policymakers have been warning about the growing levels of debt, which can lead countries, corporations, and households to tighten their belts and reduce spending and investments, ultimately impacting economic growth and living standards. More than 80% of the recent increase in debt came from developed countries, with the United States, Japan, Britain, and France experiencing the largest increases. Among emerging markets, China, India, and Brazil saw the highest rises in debt. This is a notable shift, as emerging markets are exhibiting a better trend compared to developed markets for the first time in a while, according to Todd Martinez, co-head of the Americas sovereign team at Fitch Ratings. The report also highlighted that household debt-to-GDP in emerging markets is still higher than pre-COVID-19 levels, primarily driven by China, Korea, and Thailand. However, mature markets have seen the lowest household debt-to-GDP ratio in two decades during the first half of this year. Tiftik mentioned that consumer debt burdens appear manageable, and if inflationary pressures persist, the health of household balance sheets, particularly in the United States, will provide some protection against further interest rate hikes by the Federal Reserve. While markets currently do not anticipate a near-term rate hike by the U.S. Federal Reserve, the target rate is expected to remain between 5.25% and 5.5% until at least May of next year. This sustained high rate in the U.S. could put pressure on emerging markets as investors prioritize the less risky developed world for investment.
by HiumanPre
2
EURUSD: 18/09/2023: Is it time to move up? You can see possible scenarios on the chart. the price after taking the sell-side liquidity can move higher to break the previous high and then touch the bearish order block. What I expect is the price test the lower price again and then start to move up. (Scenario 1) Since the price collected sell-side liquidity, it is possible to move to higher prices from here. (Scenario 2) 💡Wait for the update! 🗓18/09/2023 🔎 DYOR 💌It is my honor to share your comments with me💌
Long
by VahidTradingCR
1
EURUSD Long Term Buy Trading IdeaHello Traders In This Chart EURUSD DAILY Forex Forecast By FOREX PLANET today EURUSD analysis 👆 🟢This Chart includes_ (EURUSD market update) 🟢What is The Next Opportunity on EURUAD Market 🟢how to Enter to the Valid Entry With Assurance Profit This CHART is For Trader's that Want to Improve Their Technical Analysis Skills and Their Trading By Understanding How To Analyze The Market Using Multiple Timeframes and Understanding The Bigger Picture on the Charts
Long
by ForexPlanet20
EURUSD Pair Breaks Out of the Ascending Channel Weekly Analysis of #EURUSD, Monday, September 10, 2023 In the weekly chart of #EURUSD, the price has broken out of the #ascending channel and crossed below the 50-day moving average. Consequently, the market structure appears bearish or corrective. In the current week's trading, if selling pressure continues and the $1.07 rate is breached, the #EURUSD pair could initially move towards the minor support at $1.0635. If the #downward momentum persists, the next target for #EURUSD will be the support range of $1.0530 to $1.0481. So based on this analysis I suggests a bearish or corrective outlook for EURUSD.
Short
by POUSHEINI
2
EURUSD BUY SIGNAL DAILYHello dear traders, The EUR/USD currency pair is in an upward channel on the daily timeframe. Given the areas of supply and demand, as well as the liquidity present at the green levels, trading in this area can be logical. The trigger for entering this trade is the breaking of the downtrend line, which is indicated by the purple color. This means that we are not allowed to enter until this line is definitely broken. Suitable support levels for going long with the condition of breaking the downtrend line are: 1) 1.090 2) 1.073 You can place your stop loss below the pivot formed. I hope this has been useful for you.
Long
by jawad369
📈EURO analysis, Weekly insight into price behavior📉FX:EURUSD OANDA:EURUSD Hello Traders, please check out my previous ideas. Continuing from the previous analytical scenario, if the euro stabilizes above the red zone (crossing the weekly Bollinger midline), the price can climb up to the right shoulder. In the opposite scenario, if the price does not follow the conditions of the previous scenario, the price can fall to around 1.07676. ✌💥If you are satisfied with my analytical content, please share my ideas💥✌ ✍🐱‍👤Otherwise, make sure you leave comments and let me know what you think.🐱‍👤✍ 🤑🍾Thank you for your support. I hope you will gain profit by following my analyses.🍾🤑 CrazyS✌
Long
by CrazyS
1
A Sell for the EURUSDThe EURUSD has exhibited an upward trend, likely influenced by a slight decline in the Dollar, possibly linked to the ongoing Jackson Hole Symposium, which holds significance for various markets awaiting insights from FED Chair Jerome Powell. When considering both fundamental and technical perspectives, our stance remains bullish on the dollar, unless there is a shift in the underlying fundamentals. The Dollar's moderation led the EUR to approach a notable supply zone around 1.09300. Interestingly, referring to yesterday's analysis, the market displayed a favorable response near 1.09150. However, a closer examination revealed that the market did not experience a substantial breakdown in its structure towards the downside. Consequently, it swiftly reversed its course, ascending towards the 1.09300 mark. Anticipating the market's trajectory, I find the only potential concern was the demand zone situated around the 1.087 level. Yet, I am confident that this demand has been effectively depleted. Furthermore, a noticeable volume of liquidity exists on the downward side. As a result, my expectation is for the market to trend downward, approaching the 1.084 range.
Short
by DagemFxStudio
EURUSD 30-Minute Chart AnalysisTraders and analysts alike are perpetually drawn to the intricacies of chart analysis. In today's discussion, we delve into the 30-minute chart of EURUSD, shedding light on its recent price movement within the symmetry triangle's second part. This analysis unravels the story of EURUSD's descent since August 10, 2023, and the compelling zones that have come into play during this intriguing period. 1. Support 1 at 1.09002: At the foundation of this analysis, we find Support 1 at 1.09002. This zone has been instrumental in halting the price's decline on multiple occasions. It signifies the market's willingness to prop up the EURUSD pair around this level, showcasing the impact of investor confidence and the potential for a rebound. 2. Support 2 at 1.08742: Deeper within the price's journey lies Support 2 at 1.08742. This level has proven to be a robust barrier against further declines, demonstrating its resilience as a technical stronghold. Traders are closely monitoring how the price interacts with this zone, as it could be a decisive point for the pair's next move. 3. Resistance 1 at 1.09627: As the price attempts to regain lost ground, it faces its first challenge at Resistance 1, situated at 1.09627. This zone has acted as a notable ceiling for the EURUSD's ascent, revealing the hurdles in the way of a substantial recovery. Observing the price's behavior near this resistance can provide insights into the strength of the ongoing bullish sentiment. 4. Resistance 2 at 1.10059: Moving further up the chart, Resistance 2 at 1.10059 stands as a testament to the market's determination to resist the price's upward momentum. This level symbolizes a key checkpoint for the EURUSD pair, and traders are closely gauging how the price reacts as it approaches this significant boundary. 5. Resistance 3 at 1.10500: At the zenith of this analysis, we find Resistance 3 at 1.10500. This level represents the highest point the price has managed to reach since August 10. The battle between buyers and sellers intensifies around this mark, as the price's interaction with this resistance could foreshadow a breakout or a retracement. Conclusion: The EURUSD 30-minute chart offers a captivating narrative of the pair's journey through a symmetry triangle's second part, encapsulating the dynamics of its descent. The defined support and resistance zones, each with its own story to tell, guide traders in understanding the prevailing market sentiment. However, it's important to remember that while technical analysis offers valuable insights, a comprehensive trading strategy integrates various factors, including fundamentals and psychology, to make well-informed decisions. As the market continues to respond to economic data releases and global events, traders are poised to leverage the insights gleaned from this technical analysis, ensuring a holistic approach to trading EURUSD and capitalizing on potential opportunities.
by enclavefx_Analaysis