The dollar soared to highs last seen in July 2020 against other major currencies on Thursday and Friday, a day after the Federal Reserve said it could deliver faster and larger interest rate hikes in the months ahead.
With the Fed flagging that it was ready to start lifting rates in March to contain surging inflation, money markets moved to price in as many as five quarter-point increases by year-end.
The Fed's hawkish tone on Wednesday brought dollar bulls out in force. The Dollar Index, which measures the greenback's value against other major currencies, rose to 97.299, the highest since July 2020. The 0.8% jump was the biggest single-day gain in more than two months. (Reuters).
Overall the EURUSD market is bearish with a downside breakout likely sending trade to attack a 1.1101 the June 2020 low, when broken 1.0933 shall be tne next target. A reluctance to extend under 1.1101 hints for attempts to rebound this week. Corrective rebounds trapped by 1.1185 will maintain bear forces. Expecting a minor correction up towards 1.1230 and after that movement the Euro will roll back lower for new lows till the 1.0700.
Resistance 2 1.1185
Resistance 1 1.1165
Support 1 1.1120
Support 2 1.1101