USD gains momentum as Powell signals Fed’s uncertainty in rates

The USD is moving higher after Powell indicated that he is not confident that the Fed has reached its peak in rates.

EURUSD: The EURUSD is moving back down toward the low of the swing area between 1.0674 and 1.0694 below that is a 38.2% retracement of the move up from the November 1 low. That level comes at 1.0664. Getting and staying below that level opens the door for further downside momentum with next key support near the 50% of the same move higher at 1.06357.

USDJPY: The USDJPY is trading at 151.23 and at the highest level since November 1. The next target is near 151.39. Above that and the high price from October 31 at 151.707 would be targeted. Earlier today the price moved back above the 151.00 level increasingly bullish bias. Remember on the FOMC day on November 1, the price was trading at 151.00 right before the interest-rate decision. Getting and staying above that level was more bullish

GBPUSD: The GBPUSD is moving below its 200-hour moving average at 1.2243 and 50% of the move up from the October 26 low at 1.22482. Those levels are now risk levels for sellers. On the downside, getting below 1.22193 would have traders looking toward the 1.2200 area. Sellers are in control.

USDCHF: The USDCHF stalled its rally on the last hourly bar right at its 200-hour moving average at 0.9025. The Powell comments have now pushed the price above that moving average level. The 200-hour moving average is now a close risk for buyers looking for more upset momentum.

US yields are still near high levels but not at the highest level of the day:

  • 2-year yield 5.007% +7.2 basis points
  • 5-year yield 4.625% +10.2 basis points
  • 10-year yield 4.64% +11.6 basis points
  • 30-year yield 4.788% +13.1 basis points

US yields have been hurt from a horrible 30-year bond auction today.

Looking at the US stock market: major indices are low all lower. The S&P and NASDAQ are in jeopardy of breaking their 8 and 9-day winning streaks:

  • Dow industrial average -173.33 points or -0.51% at 33940
  • S&P index -24.2 points or -0.55% at 4358.65
  • NASDAQ index -78 points or -0.57% at 13571.40

This article was written by Greg Michalowski at Source