EUR/USD trades at one-month highs as the dollar keeps more vulnerable

Technical Analysis

Author: Justin Low | eurusd

EUR/USD trades at its highest since the end of January as the dollar holds on the edge after yesterday's fall

EUR/USD D1 23-02
The pair managed a close above daily resistance of 1.2150 yesterday and is now trading at its highest levels in a month, around 1.2170-75 on the session.

There is some swing region resistance as well as the 61.8 retracement level of the swing move lower to start the year, offering a technical impediment for buyers around the region of 1.2178-96 though for the time being.

That said, the dollar is keeping in a vulnerable spot and if that gives way, we could be on course to retest the highs closer to 1.2300 once again.

Looking across the board, GBP/USD is keeping a break of 1.4000, AUD/USD stays poised in the hunt towards 0.8000, and USD/CAD is at its lows for the year below 1.2600.

Even the upside push in USD/JPY has lost much confidence after having tested the 105.00 handle earlier today, although buyers are hanging on for now.

Elsewhere, NZD/USD is also trading at its highest levels for the year as buyers look to hold a break above 0.7300 in search of fresh highs since April 2018.

Fed chair Powell's testimony in Congress will be a key highlight in trading today but I don't expect to hear anything different from what we have heard from himself or Fed speakers since the start of the year.

One thing to watch is perhaps Powell might make further mention on inflation and yields. However, besides that, nothing should change with regards to their monetary policy view/outlook i.e. lower rates for an extended period of time.

That will serve as a reminder that the Fed put remains very much in play and keep the status quo in the broader scope of things for the dollar.
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