Jackson Hole Symposium Will Determine Financial Market Sentiment

On Thursday, the annual economic symposium will start in Jackson Hole. Representatives of the Central Banks, finance ministers, leading economists, and leaders of major financial corporations will participate in it. Investors will be focused on the speech by the Fed's Chairman, Jerome Powell, which is scheduled for Friday, 17:00 (GMT+3:00). The official may submit updated economic forecasts, as well as indicate the prospects for the Fed's monetary policy.

It should be recalled that in July, the US Central Bank lowered the range of key interest rates by 25 basis points to 2.00-2.25%. According to the FOMC minutes, further adjustment of the Fed's monetary policy will be determined based on new economic data. Financial market participants are concerned about the likely recession of the economy amid an inversion of the US government bonds yield curve. Washington and Beijing still can't resolve trade disputes. Inflation expectations are weakening, which may force the Fed to act more aggressively in terms of easing monetary policy. Donald Trump continues to criticize the Central Bank for the strong dollar actively and believes that it is necessary to cut the key interest rate by 100 basis points in the near future. At the moment, more than 98% of financial market participants believe that the Fed will reduce the range of key interest rates to 1.75-2.00% at a meeting in September.

cme-fedwatch-tool-2019-08-22
Source: cmegroup.com

We recommend paying attention to the comments by the Fed's Chairman, Jerome Powell, at a press conference in Jackson Hole.

Let's consider the current technical pattern on the EUR/USD currency pair

  • Support levels: 1.10650, 1.10300, 1.10000
  • Resistance levels: 1.11100, 1.11550, 1.11850
  • market-news-2019-08-22

    Since the beginning of this week, the EUR/USD currency pair has been in a sideways trend. A unidirectional trend is not observed. The trading instrument formed the following key support and resistance levels: 1.10650 and 1.11100, respectively. Indicators do not give accurate signals:

    • - 50 MA has crossed 200 MA;
    • - The MACD histogram is near the 0 mark.

    We recommend opening positions from the key levels.

    If the price fixes below the support level of 1.10650, the EUR/USD quotes are expected to fall. The movement is tending to 1.10300-1.10000.

    An alternative may be the recovery of the EUR/USD currency pair to the level of 1.11500-1.11750.

    Confirmations and entry points to the market should be looked for on lower timeframes. When following positions, we recommend using a trailing stop.

    by JustForex, 2019.08.23

    This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

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