EURUSD quotes are declining in an upward trend

22 June 2023 152
EURUSD quotes are declining in an upward trend

The dollar index is trading near a one-month low after a speech by the head of the U.S. Federal Reserve System (Fed).


As Fed Chairman Jerome Powell said in his address to lawmakers on Capitol Hill, further interest rate increases may be considered quite probable if the current economic trend continues.


Edward Meir, a metals analyst at Marex, said the market still believes in the central bank's monetary policy easing process. Therefore, volatility in the market remains stable.


Meanwhile, Rafael Bostich, president of the Federal Reserve in Atlanta, became the first federal politician who suggested waiting until at least the July meeting to make a decision on further interest rate hikes.


According to the CME FedWatch tool, traders estimate the chance of an interest rate hike by 25 basis points next month at 72%.


Now traders are waiting for the data on weekly initial jobless claims in the U.S. at 11:30 GMT. The indicator represents the number of people who applied for unemployment benefits for the first time in the reporting period. Then, the unemployment rate in the country is calculated on the basis of this and other employment and unemployment indicators. According to forecasts, the number of applications should decrease to 260K from the previous value of 262K. If the forecast is correct, it will be considered as a positive factor for the U.S. currency.


On Friday, the Purchasing Managers Index (PMI) of the European Union manufacturing sector will be published. The data reflect the current state and future prospects of doing business in the region. These are some of the earliest indicators of the economic situation. It is forecasted that the index should fall to the level of 44.8, which is a negative factor for the euro.


The EURUSD currency pair quotes are forming an uptrend on the H1 timeframe. The price pullback from the local resistance of the trend indicates a price movement towards upward support. Stochastic Oscillator (standard values) confirms the possibility of the decrease in the pair's rate, when the moving lines go out of the overbought zone. 



Short-term prospects of the EURUSD pair are to sell

The target is at the level of 1.0920.

Part of the profit should be fixed near the level of 1.0960.

The stop-loss is at the level of 1.1045.

"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.

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