The euro / dollar pair headed to the upper border of the monthly sideways range
On Monday, January 10, trading in the euro ended in decline. The euro fell in price against the US dollar by 0.32%, to 1.1325. Against the background of a decline in futures for US indices and an increase in the yield on 10-year bonds, the pair fell to 1.1285. The price remained in the Nov 30, 2020 range and bounced back from the 1.1335 support. The daily candle closed with a bearish body and a long lower shadow.
Scheduled statistics (GMT +2):
Italy To Release November Retail Sales Data At 11:00 AM
At 12:20 the head of the ECB K. Lagarde will deliver a speech
Cleveland Fed President Loretta Mester will speak at 16:00
Esther George, President of the Federal Reserve Bank of Kansassiti, will deliver a speech at 4:30 pm
· At 5:00 pm, Fed Chairman Jerome Powell will speak at the Senate Banking Committee.
At the time of writing, the euro is worth 1.1336. Major currencies are trading in positive territory against the US dollar. Fears of a faster tightening of the FRS monetary policy persist in the markets. The focus of traders is on US consumer inflation data (Wednesday), which may have an impact on expectations for the Fed's monetary policy.
The yield on 10-year US bonds is 1.76% per annum (maximum in two years). If the yield goes into a correctional phase, the growth of the EUR / USD pair will continue to the 1.1360-1.1375 zone. The upper border of the monthly sideways range is at 1.1385. Upon reaching 1.1360, we should again expect an increase in sales. A surge in volatility is expected during the presentation by K. Lagarde and J. Powell.
Summary: on Monday, the euro closed slightly in the red. The market continues to be strongly influenced by expectations for the US Federal Reserve rate hike in March. On Tuesday, a surge in volatility is expected during the speech of the head of the ECB K. Lagarde and the head of the US Federal Reserve J. Powell. The target area for the euro is 1.1360-1.1375.