DOLLAR BEARS LICK THEIR WOUNDS AS YELLEN SHOW BULLS SOME LOVE

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And that was beautiful wrapped present from federal reserve chairwoman, Janet Yellen, yesterday for the USD bulls when she said it will be unwise to delay tightening. The hawkish tone of Yellen sent the dollar up against all it major pairs.

Chairwoman Yellen, was not explicit on dates for a possible rate hike but her stands on financial reform and tax cuts was in line with that of President Trump. That was enough for investors to drive the dollar high. Her tone has given back some life to a possible rate hike in March which was believed to be off the table when weekly and hourly wage data came in weak few weeks ago.

Yellen testimony surprised many traders and investors as most where sure of a modest tone. Due to that a pair like the EUR/USD was very strong. Poor data from Germany and Euro zone which should have sent it tumbling was shaken off and even broadly better data from the US could not shake the EUR/USD until the testimony session started.  

The EUR/USD lost it footing and it was dragged deep into the 1.05600 regions. The EUR/USD has not recovered since. Its currently trading in the 1.05500 regions with a day two of Yellen testimony before congress very much eyed.

The EUR/USD will be an interesting pair to watch with politics hovering over the euro zone. The politics of Le Pen in France threatens the future of the single market.  

The USD/JPY pair also had a walk in the park as analyzed. The pair was up and currently controlling 114 regions with an eye for 115 regions now that it has tested above the 200 simple moving average (sma) on the 4hour chart. If the pair is able to hold above the 200sma of 114.550 there is a clear opening for an upward change in trend in the coming weeks.

More data from the US is coming up today and the market seem confident of it being positive for the dollar bulls. Traders and investors will be watching Core Consumer Price Index (MoM) for January, Industrial Production Index (MoM) January and Retail sales (MoM) January, if they fall in place for bulls, plus a hawkish tone from Yellen then nothing can be out of reach of bulls for today and the coming weeks.

DISCLAIMER: THIS ARTICLE IS BY NO MEANS AN INVESTMENT ADVISE. THERE ARE GREAT OPPORTUNITIES IN FOREX TRADING AS WELL AS RISKS. THIS PIECE AND ALL ARTICLES ON THIS BLOG ARE FOR INFORMATION PURPOSE