Thursday, November 10, the European single currency against the dollar in early trading attempts of a rebound after a strong volatility of the previous day.
Yesterday, Wednesday, when the preliminary results of the elections and it became clear that Donald trump is going to win in spite of the consensus forecasts of sociologists and political analysts, the dollar has borne the brunt. The currency pair EUR/USD for a few hours of take-off quite a bit not reached to the level of 1.13, but then, when the victory of the candidate-Republican became official, the dollar turned up and played confused.
Apparently, the peaceful admission of defeat Hillary Clinton and quite meaningful victory speech trump lowered the degree of tension and nervousness on stock markets that has not only enabled the dollar to rebound, but the American stock market to finish at a significant advantage. In addition, the constructive effect on the trading sentiment had promises of some Central banks to intervene in the markets if necessary.
However, at this stage, the local dollar is unlikely to go into a sustainable trend given the fact that Mr. trump not everything is transparent with his plans on the economy. During his election campaign the Republican has made controversial comments about monetary policy – at one time supported low rates, and then criticized them and even accused the fed of deliberately keeping rates low in the interest of the Clinton. From trump’s words that “Yellen should be ashamed”, and now at the December meeting, the fed Chairman, the term of which expires in 2018, will have to face a serious dilemma. In the coming weeks, the currency market will wait for the comments of the officials of the fed to understand what has changed in the positions of the open market Committee in connection with the election trump. Today, in particular, the expected performance of head of FRB San Francisco’s Williams and the President of the Federal reserve Bank of St. Louis Bullard.
From a technical point of view, in the 4 hours chart the course went beyond the lower limit of bands of Bolliger and subject to the provisions of the stochastic lines maintains the potential rebound in the short term.
Source: MetaTrader Finam Ltd, 4-Hour Chart