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  • EUR/USD began recovery on Friday and is poised to gain further.
  • Lagarde and Powell are up to speak this week.
  • Investors are interested in monetary reports rather than inflation figures.

The EUR/USD price on Friday, July 9, performed a reversal near the correction level of 76.4% (1.1837) and continued the uptrend, which began after the prices consolidated above the downtrend line. Thus, let me remind you that the mood of traders has changed to bullish according to the latest changes.

Therefore, the pair can be expected to continue to rise in the direction of the correction levels 61.8% (1.1919) and 50.0% (1.1985). The information background has been quite diverse lately. The most interesting news is related to the speeches of the representatives of the ECB and the FRS.

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Christine Lagarde and Jerome Powell speak frequently but rarely talk about economics and monetary policy. And in any case, the sentiments that now prevail in the US and EU central banks are well known to traders. By and large, in recent months, everything revolves around inflation and economic recovery. In the US, inflation rose to 5%, which is quite high.

In the European Union, inflation went up to 2%. But at the same time, the American economy is recovering much faster than the European economy. As a result, Jerome Powell has made it clear that the Fed will not cut its stimulus program simply because inflation has soared.

Both the ECB and the Fed said that “chickens should be counted in the fall,” so absolutely no one panics at this time due to rising prices. Furthermore, Powell and Lagarde have repeatedly stated that the jump in inflation is temporary due to last year’s low base.

Thus, central banks expect that inflation will start to slow down soon, which will allow more calmly continuing to support the economic recovery through various stimulation programs. However, traders at this time show very little interest in this kind of information. Instead, they are interested in economic reports and any important fundamental events, of which there are not so many now. Therefore, the attention of traders may be now shifting more towards technical analysis.

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EUR/USD price technical view: Key levels to watch

On the 4-hour chart, the quotes of the pair rebounded from the Fibo level of 76.4% – 1.1782 and rose to the correction level of 61.8% – 1.1890. The pair’s rebound from this level will allow counting on a reversal in favor of the US Dollar and the resumption of the fall in the direction of the 76.4% level. Closing prices above the 61.8% level will increase the chances of continued growth in the direction of the next correction level of 50.0% – 1.1978. None of the indicators has any mature divergences today.

EUR/USD price chart of 4-hour
EUR/USD price chart on 4-hour

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