This new week starts off relatively calm, after a busier Friday session.
Powell's speech during the Jackson Hole symposium ended up not bringing any surprises, but it triggered great movements in the market. The US indices returned to close to their historical highs and gold also soared, while the USD came under further downward pressure.
During today's session, we can see a continuation of the trend that started in the last session. The pair EUR/USD continues to try to extend the gains, however, the lack of volatility in the market ends up limiting the movements in the market.
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On the daily chart we see that the psychological barrier near 1.17 has been a strong zone that has supported the rising price quite well. The breakout of the falling wedge ended up boosting the buying strength further, but it eventually eased after buyers tested the 50 period EMA.
EUR/USD, daily time frame chart. Source: xStation 5
EUR/USD 4 hours time frame chart
Taking a shorter time frame, we can see that the price is recovering slightly lower at the moment. On the other hand, the EMA of 50 periods to 4 hours could prove important in the short term.
EUR/USD, 4 hours time frame chart. Source: xStation 5
US dollar Index (USDIDX)
On the other hand, the Dollar Index continues to support the bullish trend in the EUR/USD pair. Although the price has had difficulty in starting the movement after the break of the trendline, the movement has emerged and is expected to continue for the next few sessions.
USDIDX, daily time frame chart. Source: xStation 5
AUD and USD are the best major performers, while the CAD and CHF are the worst performers among the fx majors.
Source: currency-strength.com
Henrique Tomé, XTB Portugal
