EUR/USD Bounces Off the 50 SMA, Even As the FED Accepts the Economic Boom in the US
EUR/USD remains bullish, despite the US economy being in the middle of a boom
[[EUR/USD-sponsored]]
EUR/USD resumed the larger bullish trend again in April, after retreating down in Q1 of this year. This pair has climbed around 5 and a half cents since early March, with moving average doing a great job as support.
The 50 SMA (yellow) in particular has been a great support indicator, pushing EUR/USD higher, while the 100 SMA has helped when the pullbacks were deeper. Last Friday we saw the latest retreat, as the price fell around 80 pips, but the 50 SMA (yellow) held as support on the H4 chart and EUR/USD bounced off that moving average.
The FED is starting to accept the fact that the US economy is booming and inflation is also increasing, which should be positive for the USD. But, the Buck continues to decline and this pair remains bullish. Below are the comments from Bainard, which sounded hawkish to me.
Feds Brainard in answering questions at a cyber conference
- US in the middle of an unprecedented rebound in the economy
- Expecting some higher inflation readings in the near term because of basic facts
- Prices are rebounding from pandemic lows
- Price increases are linked to a surge in demand
- Relief payments and other assistance are affecting spending.
- Some bottlenecks and supply chains are contributing to inflation
- Expects price pressures from bottlenecks and reopening to subside over time
- Fed has the tools to guide inflation back to the downside if price pressures move persistently above our goals
Brainard Commenting on Cryptocurrencies
- Cross border payments one of the most compelling cases for digital currencies
- The central bank digital currency could be a foundation for innovation, more efficient payment system
- In contrast to private money, a CBDC would be a new type of central bank money
- not obvious private stablecoins could offer same protections as bank deposits or cash
- consumers trust current system because of the deposit insurance, supervision, other protections
- in contrast to private digital money, a CBDC would be a new type of central bank money
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