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Fed Chair Janet Yellen provides words that boost the greenback. She gives the strongest hints yet that the Fed will raise rates.

EUR/USD falls below 1.0550. Further support awaits at 1.0530, the April low. Update: after the  initial drop, EUR/USD is bouncing back up. There seems to be some hesitation ahead of the Draghi Drama  tomorrow.

At a speech in Washington, one day before her official testimony, she says that the labor market gains boost her confidence about inflation. In addition, she doesn’t seem too worried about China,  something that stopped the Fed back in September.

Earlier in the day, the ADP NFP beat  estimates, raising expectations for Friday’s official NFP. Did Yellen  also provide us a hint for Friday?

In general, she sees downside risks as balanced and she expects inflation to rise to 2% in the next few years.

EUR/USD is not the only currency moving: also GBP/USD dropped below 1.49 and USD/JPY is challenging the 123.60 level.

Here is how the chart looks like:

EURUSD down on Yellen December 2 2015