On Monday, November 8, trading in the euro ended with growth. The euro gained 0.17% to 1.1587. Buyers were active in the European session, when the dollar started losing ground throughout the market. Market participants continued their upward movement on Friday, ignoring a slight recovery in the yield on 10-year bonds and speeches from the US Federal Reserve.
US Federal Reserve Deputy Head Clarida said the conditions for the rate hike would be created by the end of 2022.
The head of the US Federal Reserve St. Louis Bullard expects two rate hikes in 2022.
ECB spokesman Lane said supply disruptions and rising energy prices are the main risks to the inflation forecast and to the ECB economy.
Scheduled statistics (GMT +3):
At 10:00, Germany is to publish data on the trade balance for September.
At 13:00, in the eurozone will be released the index of economic sentiment from the ZEW for November and the index of business sentiment for November in Germany.
At 16:00, the head of the ECB Lagarde will deliver a speech.
At 16:30, in the US will be released PPI for October.
At 17:00, the head of the Federal Reserve, J. Powell, will deliver a speech.
At 19:00, the Governor of the Bank of England E. Bailey will deliver a speech
At 19:35, FOMC member Daley will speak.
Current situation:
Major currencies are trading in positive territory against the dollar except for the Aussie. EUR/USD has recovered to $ 1.1607 and is trading at $ 1.1599.
The focus of traders' attention has shifted to the speeches of Fed Chairman Jerome Powell, Bank of England Governor Andrew Bailey, ECB Governor K Lagarde for fresh hints on monetary policy.
Investors are also paying great attention to who will become the head of the US Federal Reserve in 2022. Biden will decide on the head of the Fed for Thanksgiving. The main contenders for the post of head of the Federal Reserve are Leil Brainard and Jerome Powell. Experts believe that if Leil Brainard becomes the head, the dollar will be undermined.
On Thursday, the US will release a report with data on consumer inflation. The data should indicate the future steps of the US Federal Reserve regarding monetary policy.
Technical analysis:
The dollar index broke through two levels of 94.15 and 94.03. Against the backdrop of an appreciation of the euro, there are risks of falling to 93.82. EUR/USD recovered to 1.1606. Growth has slowed down near the resistance, which is the upper line of the channel (it is built on three values: 1.1535-1.1513 and 1.1616).
From the low of 1.1513 to 1.1606, the rally has a five-wave structure in the form of an initial diagonal triangle. If there is no sharp decline before the close of the European session, then we are preparing for an increase to 1.1650. Supports are two levels 1.1590 and 1.1575.
Summary: on Monday, the EUR/USD pair closed with growth. Buyers met resistance at 1.1606. The focus of traders' attention shifted to the speeches of Fed Chairman Jerome Powell, Bank of England Governor Andrew Bailey, ECB Governor K Lagarde. A surge in volatility is expected after the release of the ZEW indices and the speech of K. Lagarde.