Even quite strong data on the US unemployment claims failed to prevent the euro and the pound sterling from a considerable rise. The fact is that the US dollar is extremely overbought. Traders have been long buying the asset.
Expectations of a pause in the cycle of monetary policy tightening are soaring ahead of the upcoming Fed meeting. Today, the greenback may continue falling amid the absence of important macroeconomic data. The market will try to remedy the existing imbalance. The US dollar index is likely to drop for the second week in a row.
On the chart of the most traded currency pair in the market, we see that the euro may close the week with a rise against the US dollar. The euro has already reached a new local high of June.
The quote approached the resistance level of 1.0800, which acted as an obstacle for buyers. A decline in the number of long positions led to a slowdown in the upward cycle. The market sentiment was mainly determined by traders’ actions near the level of 1.0800.
To go on gaining in value, the quote should consolidate above this level at least on the four-hour chart. Otherwise, the pair may slump.
Meanwhile, the pound sterling also showed rapid growth and hit the resistance level of 1.2550. Just after the price touched this level, the volume of long positions dropped, thus spurring a slowdown. The fact that the pair once again approached the level of 1.2550 points to the pound’s recovery after the recent correctional movement. If the price consolidates above this level, it is likely to go on climbing to a new local high of the mid-term uptrend. However, if the pound sterling fails to settle above the mentioned level, it may drop, thus boosting the number of short positions. This will reflect a downward trend.
That’s all for now. We keep monitoring the financial market situation. Subscribe to our channel. See you in several hours. We will take a close look at the US trading session.

00:00 Introduction
00:17 Fed interest rate
00:40 EUR/USD
01:14 GBP/USD
02:11 Conclusion

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