The pricing of the EURUSD pair in recent days is based on strong fundamental factors.
On Wednesday, the Federal Reserve System (Fed) raised interest rates by 25 basis points to the 5.25% level. At the same time, the head of the regulator hinted at a pause in interest rate hikes. On this background the quotes of the pair approached the maximum values of April.
On Thursday, the Governing Council of the European Central Bank (ECB) decided to raise its benchmark interest rate by 25 basis points to 3.75%.
At the previous meeting, the European regulator increased the rate by 50 basis points, compared to yesterday's 25 points. This suggests that the ECB is slowing the pace of rate hikes, reducing the phase of tight monetary policy.
This is the seventh consecutive increase in the base rate and the highest level since 2008.
The ECB, like most other major central banks, is trying to achieve a record rate of inflation and get closer to its 2% target.
The news from the European regulator pulled the EURUSD pair back to the support of 1.0985.
Today at 15:30 Moscow time the U.S. non-agricultural employment data will be published. According to forecasts, the number of employed people should fall to the level of 180,000, which is down by 56,000. Confirmation of the forecast or deviation from it downward will weaken the value of the dollar and, consequently, strengthen positions of the euro in the short term.
The EURUSD pair is in an upward corrective corridor on the H4 timeframe. The price rolled back from the buffer resistance line towards upward support to the level of 1.0955.
The Relative Strength Index (standard values) demonstrates the presence of convergence. Downward resistance of the price chart and the indicator show a decrease in the interest of market participants to buy and a possible change in the trend.
Today's news background may bring the pair back to the area of downward resistance, but the technical characteristics for the price decline remain good.
EURUSD signal:
To sell near the level of 1.1070.
The target is at the level of 1,0955.
Part of the profit should be fixed near the level of 1,1010.
The stop-loss is at the level of 1,1105.
"Bearish" trend has a short-term character, so the volume of trade should not exceed 2% of your balance.
This content is for informational purposes only and is not intended to be investing advice.
