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Greenback comeback as Harker talks about a hike in March

FOMC member  Harker talked about the option of raising rates in March.  He joins a growing chorus of Federal Reserve officials that do not rule a Spring hike, with some supporting this option with a full throat.

Fed Chair Janet Yellen  did not really provide a clear hint about March but left the door open. She talked about raising rates in one of the “upcoming meeting”. The  upbeat tone raised the chances but the use of the plural version meant that a hike in March and a faster rate of rate rises is not really on the table.

In any case, the US dollar is now on the rise, with EUR/USD dropped off 1.06 once again and finding some support around 1.0570. Much stronger support awaits at 1.0520. Resistance is at 1.0690.

The US dollar is also gaining ground against the  Japanese yen, with USD/JPY rising towards 113.50. GBP/USD is down to 1.2423.

Is the current greenback comeback only related to Harker’s comments? Certainly not.  It is also important to remember that US traders were on holiday and are now coming back online. Their return means that trading volume is rising. The US dollar strengthened on Friday, recovering from failures to advance on good news.

We might be seeing an extension of those Friday moves.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.