EURUSD defends key support and rises to 1,09 resistance zone 💵

The recent dollar bulls have led to a lot of EURUSD discounting, but at the beginning of the week buyers are coming to the fore and the Eurodollar is approaching the psychological, important barrier of 1.09 points. With the EURUSD rebounding, better sentiment is also seen in the equity market, with indices on Wall Street gaining. The eurodollar is likely to remain quite volatile this week due, among other things, to the scheduled speeches by central bankers at the symposium in Jackson Hole (Wyoming). Speakers at the event will include ECB chief Christine Lagarde and Fed chief Jerome Powell (Friday).

• Powell's hawkish pose and the cooling of the imagination of markets dreaming of first cuts in the first half of next year could strengthen the greenback and lead to a retest of the area below 1.09 on EURUSD but the market managed to defend itself at key AT levels;
• Yields on treasuries have started to rise again, 30-year bonds have approached 2011 highs and '10-years' have reached their highest level since November 2007 as investors price in a possible scenario of the Fed keeping interest rates higher for longer.
• According to an economic survey, the US economy will skip a recession, the probability of a recession slowdown occurring within the next year has fallen to 40% - the lowest expected level in more than a year. Most economists expect the Fed to hold interest rates at least until March 2024 before first cuts;
  As many as 83% of those surveyed indicated that the Fed will cut interest rates at least once by the end of Q2 2024.Nearly 90% of economists expect to keep rates unchanged in September;
• UBS lowered its forecast for China's real GDP growth in 2023 to 4.8 per cent from 5.2 per cent, and Goldman Sachs analysts recently supported the dollar by rallying higher than expected 2% US GDP growth in 2023.

The chart of EURUSD on the D1 interval shows that the price recently stopped at a key support for further momentum, defined by the SMA200 (the red line, which is used to conventionally determine the trend) and the 23.6 Fibonacci abolition of the upward wave from autumn 2022. For buyers, important resistance is now located at 1.0925 where the SMA100 (black line) runs. Overcoming it could set a path towards levels above 1.10.

Source: xStation5