As a result of the rapid growth of the US dollar, the main currency pairs on forex reached key levels.
Exit from the technical figure of the triangle, the breakthrough of the mirror level of 90.850 and the exit from the long-term descending channel led to the rally on the US dollar (USDX).
The upward movement stopped by testing the next strong mirror resistance level at 92.400.
At the same time, the euro reached the level of 1.20, the British pound – 1.36, the Australian dollar fell to the key level of 0.75, the Canadian dollar reached 1.29, and the Japanese yen closely approached the level of 110.00.
The euro after a long consolidation at the perennial highs came down from the long-term rising channel. This was also due to the breakout of the triangle down and the breakdown of key support 1,21550.
Currently, this level is a mirror resistance and with a high probability the euro can test it before continuing its decline.
The fall of the British pound was due to poor economic data and, as a consequence, a decrease in the probability of an increase in the interest rate by the Bank of England. The pound left the growing channel for the first time in a long time and stopped only at a strong mirror support level of about 1.36.
Today, the data on the index of business activity in the construction sector in the UK is expected, but they are unlikely to help reverse the trend to reduce the pound due to extremely bad weather in the reporting period.
The Fed’s decision on the interest rate is expected this evening. Since this meeting will not be accompanied by a press conference, experts do not pawn the possibility of raising rates on it. The main attention will be paid to the accompanying statement to the decision. In the case of a more rigid position of the regulator, one can expect a continuation of the trend towards strengthening the US dollar.
Let me remind you that the latest data on inflation in the US, although it showed a slight slowdown in inflation over the past month, annual inflation reached target 2.0%. This gives all grounds for raising the rate at the next meeting.
Correction on the dollar, which we are observing today, is quite possibly connected with the fixing by the bulls on the dollar of profit in the lead-up to the Fed meeting to reduce risks.