empty
18.11.2024 07:45 AM
EUR/USD Weekly Results: Trump's Appointments, Powell's Hawkish Stance, and Accelerating U.S. Inflation

Looking at the monthly chart, EUR/USD has formed two bearish candles. In October, the pair dropped by 250 pips, and in just two weeks of November, it had already fallen by almost 400 pips (opening price: 1.0883, current low: 1.0494). Notably, after the U.S. presidential election results, EUR/USD buyers managed a brief, nearly 100-pip correction, but last week saw the pair decline almost uninterruptedly. By Friday, the price paused and slightly corrected due to the "Friday effect," as market participants refrained from breaching the 1.0400 level ahead of the weekend. Consequently, the Friday candle on the D1 chart turned bullish. However, bearish sentiment continues to dominate, pointing toward the 1.0450 support level (the Kijun-sen line on the MN timeframe).

This image is no longer relevant

The driving force behind EUR/USD remains Donald Trump and his anticipated "Trumpnomics." This is the cornerstone of market developments, with all other factors deriving from it.

The week before last, the market reacted to Trump's election victory. Last week, as emotions subsided, the focus shifted to Trump's (who will take office on January 20 next year) first personnel decisions, which signaled impending tensions with China and other trade partners.

The so-called "Florida Hawks" will occupy key positions in the White House: Marco Rubio as Secretary of State (comparable to the Minister of Foreign Affairs) and Mike Waltz as National Security Advisor (the most influential position in the hierarchy of American power). Both hold aggressive stances toward China: Marco Rubio supported the Hong Kong protests four years ago and described China as "the most formidable and dangerous adversary the U.S. has ever faced."

The other "Florida Hawk" (they both represent the state of Florida), Mike Waltz, views the U.S. as still in a Cold War with China. He championed legislation reducing the U.S. dependence on China for critical minerals and called for a full boycott of the 2022 Beijing Winter Olympics.

These appointments indicate that Trump plans to adopt an aggressive stance toward China, with Rubio and Waltz likely spearheading this policy.

China, in turn, has signaled readiness for confrontation. According to the Financial Times, Chinese authorities have prepared countermeasures, including sanctions, blacklisting foreign companies, and restricting U.S. access to critical supply chains.

This escalation puts Washington and Beijing on the brink of a trade war, with potential "battle" lines drawn for early next year.

The trade war's most immediate consequence will likely accelerate U.S. inflation. As tensions mount, market speculation about the Federal Reserve pausing rate cuts in 2024 has intensified, further fueled by Powell's comments last week.

Such assumptions began to sound more confident after the speech of the Fed head, Jerome Powell, who said on Thursday that the Fed should not rush to lower the interest rate. This hawkish signal took market participants by surprise since just last week, at a press conference following the November meeting, he stated without any remarks that the central bank would continue to soften monetary policy.

Recent CPI and PPI data supported Powell's stance, reflecting the acceleration of inflation in the US. The headline CPI rose to 2.6% YoY in October, marking the first acceleration since March after a six-month consecutive decline. Meanwhile, the core CPI remained steady at 3.3% YoY.

The PPI index complemented the CPI – all report components were in the green zone. For example, the general producer price index rose in October to 2.4% year-on-year after falling to 1.9% in September (with a forecast of 2.3%). The core PPI also exceeded experts' expectations. With a forecast of growth of 3.0%, it increased to 3.1%. This indicator has been demonstrating a consistent upward trend for the third month in a row.

Following such a busy week, the market has revised its expectations for the Fed's next moves. The probability of the Fed maintaining the current rate in December rose to 40%, up from just 14–16% earlier in the week (CME FedWatch Tool).

The fundamental landscape strongly favors the continuation of the bearish trend in EUR/USD. The euro will obediently follow the greenback, which feels quite confident against the backdrop of Trump's personnel decisions, accelerating inflation in the US and strengthening hawkish sentiments in the market. The nearest target of the downward movement is 1.0500 (the lower line of the Bollinger Bands indicator on the four-hour chart), and the main target is 1.0450 (the Kijun-sen line on the MN timeframe).

Seleccione el marco de tiempo
5
min
15
min
30
min
1
hora
4
horas
1
día
1
s.
Gana con los cambios en el valor de las criptomonedas con InstaForex.
Descarga MetaTrader 4 y abre tu primera operación.
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    UNIRSE AL CONCURSO

Recommended Stories

Análisis del par GBP/USD. El 3 de julio. Jerome Powell finalmente respondió a Trump.

El par de divisas GBP/USD durante el miércoles se desplomó como una piedra. Sin embargo, cualquier caída del par siempre termina en un crecimiento mucho más fuerte. Por lo tanto

Paolo Greco 07:32 2025-07-03 UTC+2

Análisis del par EUR/USD. El 3 de julio. Una gran ley de Trump aprobada, el dólar en mínimos de 4 años.

El par de divisas EUR/USD durante el miércoles se negoció de manera bastante tranquila, si es que se puede aplicar la palabra "tranquila" a la caída diaria del dólar

Paolo Greco 07:31 2025-07-03 UTC+2

Analisis del par GBP/USD. El 1 de julio. Trump el genio y los estadounidenses ciegos. Parte 2.

El par de divisas GBP/USD bajó moderadamente durante el lunes, lo cual no representa ningún problema para la moneda británica. La libra esterlina puede permitirse tranquilamente perder 100 o incluso

Paolo Greco 07:05 2025-07-01 UTC+2

Análisis del par EUR/USD. El 1 de julio. Trump el genio y los estadounidenses ciegos. Parte 1.

El par de divisas EUR/USD continuó negociándose el lunes dentro de un rango extremadamente estrecho. El lunes hubo pocas noticias, y las que se publicaron no despertaron mayor interés entre

Paolo Greco 07:05 2025-07-01 UTC+2

El Bitcoin convierte a sus competidores en polvo

Expectativas y realidad. Los creadores de criptomonedas las concebían como un universo donde cualquier token podía competir por el dinero de los inversores. En la práctica, aparte del Bitcoin

Marek Petkovich 12:43 2025-06-30 UTC+2

Analisis del par GBP/USD. El 30 de junio. Nóminas no agrícolas, Powell y desempleo.

El par GBP/USD subió 300 puntos durante la semana pasada y, al parecer, no tiene intención de detenerse. Incluso el viernes, el precio no logró iniciar una corrección bajista

Paolo Greco 07:48 2025-06-30 UTC+2

Analisis del par EUR/USD. El 30 de junio. Inflación europea y nueva ronda de discursos de Lagarde.

El par de divisas EUR/USD continúa su movimiento ascendente durante cinco meses consecutivos. En este período, solo hemos visto algunas correcciones bajistas débiles, que cada vez terminaban con otra caída

Paolo Greco 07:48 2025-06-30 UTC+2

Analisis del par GBP/USD. El 27 de junio. La historia no se repite.

El par de divisas GBP/USD continuó su fuerte movimiento alcista durante el jueves. Desde el inicio de la semana, el dólar estadounidense ha perdido "solo" 330 puntos. Ya hemos mencionado

Paolo Greco 07:31 2025-06-27 UTC+2

Analisis del par EUR/USD. El 27 de junio. ¿Podrá Trump equilibrar la balanza comercial?

El par de divisas EUR/USD se encuentra en un "crecimiento libre" (por analogía con el concepto de "caída libre"). El dólar vuelve a precipitarse al abismo, tal como advertimos

Paolo Greco 07:31 2025-06-27 UTC+2

Análisis del par GBP/USD. El 26 de junio. Se acerca el 9 de julio.

El par de divisas GBP/USD durante el miércoles al mediodía se mantuvo en el mismo lugar. Recordemos una antigua señal técnica. Si el precio actualiza un extremo significativo y luego

Paolo Greco 08:30 2025-06-26 UTC+2
¿No puede hablar ahora mismo?
Ingrese su pregunta en el chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.