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On Wednesday the 15th of November, trading on the euro/dollar pair closed down to form a pin bar or shooting start model on the daily timeframe. The euro opened up in the European session. In the space of three hours, the rate jumped 68 pips to 1.1853. After the publication of US data, buyers shifted the intraday high to 1.1860.
Traders initially reacted by selling the dollar after the publication revealed slowing inflation in the US in October. However, annual inflation and retail sales data turned out better than expected. After a sharp reversal upwards for US 10Y bond yields, traders started taking profit on their positions on the euro/dollar.
Fuel was added to the fire by Eric Rosengren, head of the Boston Fed. Rosengren contended that due to the fact that the US economy is growing faster, the Fed should continue on its path of rate hikes for the rest of the year and into next year. By the end of the day, the rate had dropped to 1.1790, erasing all of its gains.
Day’s news (GMT+3):
Fig 1. EURUSD rate on the hourly. Source: TradingView
The U3 MA line held buyers up once again. The resistance around the 1.1850 mark was bolstered by the horizontal Gann line. In the second half of the day, some buyers exited the market, while some turned into bears.
