The dollar, in general, holds positions in the foreign exchange market after the publication last Friday of a strong report on the US labour market. As you know, the NFP index for June exceeded the expectations of economists. The number of new jobs outside the US agricultural sector in June was 222,000 (the forecast was +174,000 new jobs).
Now the market participants will closely follow the statement on Wednesday (10:00 GMT) and on Thursday (14:00 GMT) of the Chairman of the Federal Reserve, Janet Yellen. She optimistically assesses the state of the US economy. It is likely that Janet Yellen in her report before Congress will confirm the Fed's intentions in the commitment to the planned tightening of monetary policy. As Fed President for San Francisco Williams said, the growth rate of wages and inflation in the US coincides with his predictions, and another rate increase still fits into a "reasonable baseline scenario."
Today, two more FRS representatives will comment on the Fed's monetary policy: member of the Federal Reserve Board of Governors Brainard (16:30 GMT) and Fed Chairman of the Federal Reserve Bank of Minneapolis, member of the Federal Open Market Committee Neil Kashkari (17:20). It is likely that they will also act in line with optimistic statements about the future of monetary policy in the US and its further tightening.
Meanwhile, the EUR/USD is trading in a narrow range near the 1.1400 mark for the second day. Technical indicators on the 1-hour, 4-hour, daily charts are deployed to short positions.
It is likely that before Janet Yellen's speeches on Wednesday and Thursday, the EUR/USD pair will be prone to decline. The break of the short-term support level 1.1368 (200-period moving average on the 1-hour chart) may provoke further weakening of the pair and its decline to support levels 1.1285 (Fibonacci level 23.8% corrective growth from the lows reached in February 2015 in The last wave of global decline of the pair from the level of 1.3900), 1.1240 (200-period moving average on the 4-hour chart).
To resume the growth of the EUR/USD pair, a breakdown of resistance level 1.1440 (annual and June highs) is necessary.
Support levels: 1.1368, 1.1285, 1.1240, 1.1210, 1.1120, 1.0960
Levels of resistance: 1.1400, 1.1440, 1.1500, 1.1600, 1.1785
Trading recommendations
Sell Stop 1.1375. Stop-Loss 1.1410. Take-Profit 1.1300, 1.1280, 1.1215, 1.1170, 1.1120
Buy Stop 1.1410. Stop-Loss 1.1375. Take-Profit 1.1440, 1.1500, 1.1600, 1.1785
Disclosure: Comments and presented material express the personal views of the author and is not a direct guide to conduct trading operations.