empty
10.03.2021 02:20 AM
Overview of the EUR/USD pair. March 10. Jerome Powell and Janet Yellen aren't panicking about rising Treasury yields. The dollar may start to fall.

4-hour timeframe

This image is no longer relevant

Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - downward

Moving average (20; smoothed) - downward.

CCI: -63.1285

The EUR/USD currency pair started a long-awaited correction during the second trading day of the new week. Or it has completed a correction within the framework of a long-term upward trend. It depends on which side you look at it. The first thing to note is that the quotes of the euro/dollar pair fell almost non-stop and recoilless for 2 weeks. At the same time, for example, the pound/dollar pair showed a much more restrained downward mood. Although, it would seem that the factors that provoked the growth of the US dollar were the same. The euro currency fell strongly, and the pound remained close to its 2.5-year highs. Further, if we take into account the entire trend that began a year ago, and within which the European currency grew by 17 cents against the dollar, now we are seeing a banal correction against this trend. And since the ascent itself took about 10 months, the downward correction may take three or four months, of which only two have passed. Thus, if we analyze the most senior timeframes, the upward trend is not canceled and can resume at any time. If we consider the global fundamental factors, then the fall in the quotes of the US currency should continue in 2021. We have repeatedly analyzed such an indicator as to the money supply in the European Union and the United States, which allows us to conclude that the scale is excessively shifting in the direction of the dollar. Simply put, the money supply in the United States has grown excessively over the past year, and the same period in the European Union – by only 10-15%. Thus, the number of dollars in the world has become banal, which has harmed the dollar exchange rate. Based on all of the above and the fact that at least another $ 2 trillion will be poured into the US economy during 2021, it turns out that the upward trend will be resumed within the next one or two months. Returning to the 4-hour timeframe, we can conclude that now the pair will begin to rise and may go up 200-300 points, after which another round of downward movement may follow. However, in global terms, the technical picture is not changing yet.

Meanwhile, US Treasury Secretary Janet Yellen is much more relaxed about everything that is happening in the US economy than investors and traders. For example, Ms. Yellen is not worried about rising government bond yields. Earlier, the head of the Federal Reserve Jerome Powell showed about the same mood. Ms. Yellen believes that the economy will not overheat, and inflation will not fly into space, despite the trillions of dollars that the American economy has been pumping for the second year. According to the Minister of Finance, the new stimulus package, which has already been approved by the Senate, will lead to a crackdown on inflation and contribute to the recovery of economic sectors. Yellen also noted that even if inflation starts to grow strongly, the government and the Fed have enough tools and levers to keep it down. Recall that the growth in the yield of American treasuries occurs just against the background of investors' fears about the growth of inflation in the future, which will "eat" all the profits on bonds. Given the same trillions of dollars that have been poured into the economy, waiting for inflation to rise is a logical decision. Powell and Yellen make no secret of the fact that everything is being done to disperse inflation, which, according to the main US financiers, will contribute to faster economic growth. Thus, the quantitative stimulus program that the Fed is currently conducting can begin to wind down only when inflation exceeds 2.0% and will remain at this level for more or less a long time. At the moment, inflation in annual terms is 1.4%. And to say that it accelerates at a high rate is not yet possible. Therefore, a reduction in the volume of the QE program is not expected in the near future. Also, do not forget that the top officials of the United States attach great importance to the state of the labor market. And monetary policy is unlikely to tighten until unemployment and employment levels reach or even approach pre-crisis levels.

Returning to US treasuries, which many analysts and traders blame for the dollar's rise in recent weeks, their yields fell slightly on Tuesday. Formally, we can even conclude that this decline led to the fall of the US currency against the euro and the dollar. However, we still believe that the yield of 10-year treasuries, if it has an impact on the market, is not the only factor that does it. And it is certainly not a long-term influence on the dollar. We have already analyzed the yield curve of US bonds more than once and concluded that in most cases, the increase in yields did not lead to the growth of the dollar. However, we still assume that this factor has a certain impact on the US currency. In the last year, the price of stocks, cryptocurrencies, and even currencies can be influenced by factors that any trader would have laughed at a couple of years ago. Posts in the Reddit community, Elon Musk's tweets, the weak influence of macroeconomic factors – this is the reality of 2020-2021. Therefore, if most traders believe that the higher the yield of the treasury, the more dollars you need to buy, then this pattern may work for a while.

In technical terms, the downward trend on the 4-hour timeframe is still maintained, and if the bears manage to keep the pair below the moving average, the downward movement may resume this week. But we are inclined to the option with a round of upward movement since we do not particularly believe in the regularity of the growth of the dollar based on the growth of the yield of treasuries.

This image is no longer relevant

The volatility of the euro/dollar currency pair as of March 10 is 86 points and is characterized as "high". Thus, we expect the pair to move today between the levels of 1.1804 and 1.1976. The reversal of the Heiken Ashi indicator downwards signals the resumption of the downward movement.

Nearest support levels:

S1 – 1.1841

S2 – 1.1780

S3 – 1.1719

Nearest resistance levels:

R1 – 1.1902

R2 – 1.1963

R3 – 1.2024

Trading recommendations:

The EUR/USD pair started to adjust within the downward trend. Thus, today it is recommended to open new short positions with targets of 1.1841 and 1.1804 after the Heiken Ashi indicator turns down or after a rebound from the moving average. It is recommended to consider buy orders if the pair is fixed above the moving average, with the first target of 1.2024.

Seleccione el marco de tiempo
5
min
15
min
30
min
1
hora
4
horas
1
día
1
s.
Gana con los cambios en el valor de las criptomonedas con InstaForex.
Descarga MetaTrader 4 y abre tu primera operación.
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    UNIRSE AL CONCURSO

Recommended Stories

El Bitcoin huye de la criptocapital del mundo

Donald Trump prometió hacer de América la criptocapital del mundo, pero ¿quién necesita una capital de la que todos huyen? Las peores liquidaciones de empresas tecnológicas desde 2022 entristecieron

Marek Petkovich 11:54 2025-03-11 UTC+2

WTI – West Texas Intermediate. La recuperación de los precios del petróleo está limitada

Hoy, el petróleo ha intentado recuperarse desde los niveles más bajos observados desde septiembre de 2024. Sin embargo, la recuperación no puede considerarse positiva en el corto plazo. Los inversores

Irina Yanina 10:55 2025-03-11 UTC+2

Las negociaciones entre EE. UU. y China sobre comercio están estancadas

Según informes de los medios, las negociaciones entre EE. UU. y China sobre comercio y otros asuntos se han estancado en niveles bajos, ya que ambas partes no logran entenderse

Jakub Novak 07:59 2025-03-11 UTC+2

El gas sigue subiendo rápidamente de precio

Las cotizaciones del gas se han consolidado de manera firme por encima del nivel de $4, y en este momento no hay razones para el regreso del mercado bajista

Miroslaw Bawulski 13:07 2025-03-10 UTC+2

Análisis del par GBP/USD. El 10 de marzo. La libra esterlina sigue subiendo.

El par de divisas GBP/USD reanudó su movimiento alcista el viernes. El paquete estadístico estadounidense no fue lo suficientemente fuerte, lo que completó el cuadro general del desastre del dólar

Paolo Greco 07:29 2025-03-10 UTC+2

Análisis del par EUR/USD. El 10 de marzo. ¿Cuánto tiempo más bajará Trump el tipo de cambio del dólar?

El par de divisas EUR/USD, naturalmente, siguió subiendo durante el viernes. Esta vez el mercado tenía buenas razones para vender el dólar, pero recordemos que durante toda la semana pasada

Paolo Greco 07:28 2025-03-10 UTC+2

Análisis del par GBP/USD. El 5 de marzo. El mercado se está salvando. Se está salvando de la política de Trump.

El par de divisas GBP/USD sumó unos 80 puntos el martes, y 120 puntos un día antes. Por su parte, el dólar cayó en su cotización casi 200 puntos

Paolo Greco 06:47 2025-03-05 UTC+2

Análisis del par EUR/USD. El 5 de marzo. ¿Corrección alcista o cambio de tendencia global?

El par de divisas EUR/USD subió 110 pips el lunes, y el martes subió otros 60 pips antes del inicio de la sesión americana. La subida del euro

Paolo Greco 06:47 2025-03-05 UTC+2
¿No puede hablar ahora mismo?
Ingrese su pregunta en el chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.