The EUR / USD pair is currently holding near monthly highs in trading due to the weakness of the dollar.
The demand for the American currency continues to fall due to the Fed's soft statements. Apparently, the Fed's numerous verbal interventions have achieved their goal. Investors believed the regulator's statements that interest rates in the United States could remain low for a very long time, despite rising inflationary pressures.
Recently, speaking at an online conference, the head of the Fed Jerome Powell once again said that the regulator does not see any reason to revise monetary policy. The Fed wants to see a moderate rise in inflation just above the 2% mark. Powell noted that inflation has been below the target for a very long time, so the regulator expects that for some time inflation should be kept above 2%. Only then can the Fed think about changing certain parameters of monetary policy. At the same time, Powell noted that at first the Fed will reduce the volume of the QE program and only after that it can move to raising rates. The head of the Fed believes that rates are unlikely to be raised until the end of 2022, but added that everything will depend on incoming statistics.
The dollar will continue to dominate the dynamics of the foreign exchange market today as the US is expected to publish important macroeconomic data. At 12:30 GMT, the March retail sales report, the Philadelphia Fed April Manufacturing Index and weekly initial jobless claims data will be released. We are waiting for the growth of volatility at this time.
On the chart, the situation is developing within the main scenario. After breaking through the resistance at 1.1930, the price rose to the next important level - 1.1990. So far, we do not see a strong price reaction to this level. With a high probability today we can expect a breakdown of this mark.
The main scenario is a pullback to 1.1955 and growth above 1.1990.
Alternative scenario - growth above 1.1990 from current levels.
The current fundamental background is moderately positive. We are considering longs from the level of 1.1955.
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