Today the second speech of the new Chair of the Fed, Jerome Powell, will take place before the Congress. In the course of his last interview the dollar exchange rate strengthened relatively to the basket of major currencies. Then investors were convinced that in the future the new Chair of the Federal Reserve will conduct a "hawkish" policy.
Data released yesterday on GDP growth in the IV quarter indicated an increase of 2.5%. According to preliminary estimates, 2.6% was expected.
The data released today in the eurozone could not significantly support the currency. Our pair has already fallen below the level of 1.22 and in the future we will expect testing at the levels of 1.2160, 1.2120, and 1.2070.
Our technical indicators confirm the bearish sentiment in the markets. The MACD is below the zero line, while the RSI is in the oversold zone.
Our trade advice is to look for points to enter the market for short positions and set their own resistance levels as described above. During Jerome Powell's speech, one must be cautious, since volatility will be increased.
