OctaFX | OctaFX Forex Broker
Open account Sign in
OctaFX | OctaFX Forex Broker
Sign in
Open account
Market Insights
Back
Jun 22, 2018

US DOLLAR ADVANCES ON HAWKISH COMMENTS FROM FED CHAIR POWELL

KING DOLLAR

The US Dollar Index soared to a fresh 2018 trading-high this week, as United States Federal Reserve Chairman Jerome Powell delivered a hawkish speech to financial market participants. The greenback climbed to levels not seen since July 2017, as FED Chair Powell confirmed that the Federal Reserve expects at least two more rates increases this year, as the US economy outperforms. The greenback made broad based gains against the Australian, New Zealand, South African and Canadian dollar.

  • The US dollar index is bullish while trading above the 95.15 level, buyers may test towards the 95.80 and 96.30 resistance levels.

  • If the US dollar Index moves below the 95.15 level, sellers may test towards the 94.78 and 94.30 support levels.

ETHEREUM OUTPERFORMS

Ethereum continued to make strong gains this week, as the second largest digital currency by market capitalization held firm above the $500 level. The ETHUSD pair traded towards the $550 level, as its recent recovery from the $440 level continued with stronger buying volumes and momentum. Bitcoin suffered another volatile trading week, with the popular alternative coin initially dropping to $ 6,480, on reports that South Korean cryptocurrency exchange Bithumb had been hacked. The BTCUSD pair later recovered towards the $6,750 level as bullish dip-buying became prevalent across the digital currency space.

  • The BTCUSD pair is bullish while trading below the $6,200 level, further gains towards the $7,000 and $7,210 levels seems possible.

  • If the BTCUSD pair moves below the $6,200 level, sellers may test back towards the $6,057 and $5,800 support levels.

EUROPEAN WOES

The single currency remained largely under pressure against the US dollar this week, as European political woes surfaced and ECB President Draghi offered dovish comments about future ECB rate hikes, at the ECB Central Bank Forum in Sintra, Portugal. The EURUSD pair slumped towards the 1.1500 level, as a combination of dovish ECB policy, US dollar strength, and political division in Italy and German weighed on the single currency. The EURUSD pair traded at its lowest level of 2018, as the former yearly-low, of 1.1509 level, was briefly broken on Thursday.

  • The EURUSD pair is bearish while trading below the 1.1550 level, key support is located at the 1.1430 and 1.1350 levels.

  • If the EURUSD pair moves above the 1.1550 level, buyers may test towards the 1.1600 and 1.1644 resistance levels.

POUND RECOVERED

The British pound recovered heavy losses against the US dollar this week, after Bank of England voting member Andy Haldane joined the growing list of MPC members calling for an immediate rate hike. The Bank of England voted six to three in favor of keeping rates unchanged, with the GBPUSD pair recovering sharply higher on news, after earlier falling to its lowest trading level since November 2017. The British pound initially came under early-week pressure, as British PM Theresa May narrowly won the backing of Brexit rebels in a key Brexit bill vote in the House of Commons.

  • The GBPUSD pair is bullish while trading above the 1.3200 level, key resistance is now found at 1.3300 and 1.3450 levels.

  • If the GBPUSD pair moves below the 1.3200 level, sellers may test towards the 1.3144 and 1.3100 levels.

 

Start livechat