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EUR/USD: North Or South?

Published 10/11/2017, 04:34 AM
Updated 07/09/2023, 06:31 AM
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Today, the main event for the market’s participants will be the publication of the Fed meeting minutes. The publication of the protocol allows for a more complete restoration of the picture of the committee members’ argument, to understand in relation to which aspects the more significant remarks were made, and which aspects remained almost without attention. Analyzing the entire text of the protocol, market participants must draw the right conclusions about the Fed’s possible further steps in regards to the regulation of monetary policy.

An interesting movement is taking place in the EUR/USD currency pair. Many of the past reviews have repeatedly noted the level of 1.17 for this currency pair, and that level has stood firm against the backdrop of a hawkish statement by the member of the ECB's Governing Council, Lautenschlager, that it is now time to wind down the European asset repurchase program, coupled with good statistics from Germany on industrial production, which forced the European currency to move away from the 1.17 mark.

The publication of the Fed’s protocol may have a significant impact on the further movement of the pair in the short-term period, as a result of which the EUR/USD may return to the level of 1.17, or, probably, it will conquer its new local target of 1.19.

Oil is growing under the influence of a statement by US President Donald Trump and a statement by the State Corporation Saudi Aramco. You will find more details about the global outlook on the oil market in yesterday's review.

The currencies of emerging economies generally continue their local weakening trend. The Russian ruble looks best. The Russian currency does not want to lose its former positions, however, the increasingly frequent statements by the Fed and the ECB about the sooner reduction of asset retirement programs are causing the market speculators to react more and more nervously to even the slightest negative in regards to the Russian currency, and only growing prices of oil allows the ruble to trade in its usual range.

We can conclude that the volatility of the currency in the near future will increase, but there is currently no reason for the currency to exit the price range of 57-58.5.

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