The Jackson Hole symposium concluded on Saturday. The meeting of central bankers lasted from Thursday to Saturday, but the most important speech was scheduled for Friday. That’s when Fed chief Jerome Powell spoke.

Powell’s words confirmed predictions that stock market players will not receive very positive signals. The Fed must continue its tightening policy until the lowering of inflation becomes a reality. As he stated, this may hurt, but failure to act decisively would mean even bigger problems in the future.

After such a hawkish speech, most currencies lost to the dollar. EURUSD lost nearly 100 pips after the Fed chairman’s speech. However, the beginning of the current week shows a slight positive rebound , there are signs of an upward correction.

EURUSD Daily - the pair is moving south
EURUSD Daily – the pair is moving south , the pattern of “cascades” is repeated, after the forming the support and resistance levels, the price overcomes the support and tests it from below. Currently, an upward divergence is underway, suggesting a correction.

From the fundamental side, we can explain this by more hawkish statements from ECB members, we are increasingly hearing about the need to raise interest rates at 50 bps and maybe even 75 bps. We can expect such decisions at the next meeting of the European Central Bank, which will be held on September 8.

EURUSD H4 – the exchange rate is moving towards the support and resistance level of 1.01

On the technical side, too, we have signals indicating a change in sentiment on the EUR. On EURUSD yesterday an upward divergence appeared, today it continues, and in the nearest future the buyers’ target could be the support and resistance level 1.01. If the buyers’ pressure proves strong enough and 1.01 is overcome, the next target would be the supply zone starting around 1.0170. The situation is similar on EURCAD, where we also have signs of an upward correction.

More about the PA+MACD strategy and how to trade other pairs with EUR tomorrow during my live sessions – see  schedule.

This week  I am pleased to invite you to several online sessions. Below is the schedule of meetings:

  Links:  BASIC (beginners room)                        ADVANCED ROOM

The above analysis is based on the PA+MACD strategy, a detailed description of which you can read HERE . I will talk more about the PA+MACD strategy applied to these currency pairs during the live trading sessions which you can attend from Monday to Friday.
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