Powell, the chairman of the US Federal Reserve, stated that acting on inflation too soon would be a mistake.
In May, EU industrial production fell, indicating a sluggish economic rebound.
Although the EUR/USD has rebounded from a three-month low, the risk remains to the downside.
The dollar declined against all of its main counterparts, with the exception of the EUR/USD, which has tempered its rebound. At the end of the American session, the pair was trading close to its day’s high of 1.1835. The greenback has taken a hit as a result of statements made by US Federal Reserve Chair Jerome Powell. Powell maintained a dovish posture in his testimony for the Semi-Annual Monetary Policy Report. He stated that the central bank would provide strong support until the economy had fully recovered. He also predicted that inflation will continue high in the next months before dropping. It would also be a mistake to act too soon.
May Industrial Production in the EU was down 1% month on month and up 20.5 percent year on year, falling short of market expectations. The June Producer Price Index was just released in the United States, and it grew 7.3 percent year over year, exceeding market expectations. The July NY Empire State Manufacturing Index, weekly unemployment claims, and June Industrial Production will all be released in the United States.
Technical prognosis for EUR/USD in the short term
The EUR/USD pair is trading near the daily high heading into the Asian session, although its bullish potential is restricted in the short term. A somewhat bearish 20 SMA halted advances on the 4-hour chart, which are still growing below the longer ones. Technical indicators recovered from intraday lows, but just below their midlines, they lost their upward power. As long as it stays below 1.1920, a static Fibonacci resistance level, the risk is biased to the downside.
1.1780 1.1735 1.1690 1.1780 1.1735 1.1690 1.1780 1.1735 1.1690 1.1780 1.
1.1835 1.1880 1.1920 1.1920 1.1920 1.1920 1.1920 1.1920 1.1920 1.1920
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