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  • EUR/USD trades flat near 1.2150, having faced rejection at 1.2180 on Tuesday. 
  • The pair trades well within Tuesday’s indecisive range.
  • Lagarde’s comments keep the EUR bulls from cheering Powell’s dovish comments. 

EUR/USD lacks clear directional bias, with bulls refusing to step in despite dovish comments by Federal Reserve’s chairman Powell. 

“The economic recovery remains uneven and far from complete, and the path ahead is highly uncertain,” Powell said in written testimony to the Senate Banking Committee on Tuesday, contradicting widespread optimism that the economy will grow rapidly this year, leading to early Fed tightening. 

So far, however, the dollar has remained resilient, keeping EUR/USD sidelined near 1.2150 and well within the range (high and low) of Tuesday’s indecisive Doji candle. 

According to BK Asset Management’s Kathy Lien, the European Central Bank President Christine Lagarde’s recent comments on rising bond yields are keeping EUR/USD from cheering Powell’s dovish comments. 

Lagarde said early this week that board members are “closely monitoring” rising sovereign bond yields, stoking fears of central bank intervention. 

Lagarde’s comments, coupled with Germany’s slow vaccine delivery and continued stock market weakness, could continue to hamper EUR’s progress. 

The pair may find bids if the German data due at 07:00 GMT carries a big upward revision to the country’s fourth-quarter gross domestic product (GDP) reading. 

Later Wednesday, the focus would be on Powell’s testimony and US housing data. 

Technical levels

 

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