EUR/USD soars above 1.1350 as US dollar tumbles on Powell’s comments

US dollar drops sharply across the board after Fed Chairman says policy rate is just below neutral.
EUR/USD jumps almost a hundred pips and signals to a potential bottom.

Matías Salord FXStreet

The EUR/USD pair broke dramatically to the upside boosted by a sharp slide of the US dollar across the board. The pair climbed from 1.1285 to 1.1367 in a few minutes. It erased weekly losses and reached the strongest level in two days.

The rally could signal that a short-term bottom is in place at 1.1265 (Nov 28 low). The sharp recovery pushed the price above key technical levels and also on top of short-term moving averages. Currently is trading at 1.1355/65, around the 20-day SMA.

Powell defended the gradual interest rate hike policy and said the current level is still low by historical standards, “and they remain just below the broad range of estimates of the level that would be neutral for the economy, that is, neither speeding up nor slowing down growth.” The greenback dropped on Powell’s indication that rates are near neutral.

EUR/USD Technical levels

If the euro continues to rise, it could face resistance at 1.1345 (Nov 27 high), and then at 1.1360 and 1.1380 and 1.1415. On the flip side, support levels now could be seen at 1.1305, 1.1265 (weekly low) and 1.1235.

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.