US stocks staged a reversal while EUR/USD broke out to the upside on Fed Chair Jerome Powell’s post meeting press conference.
Powell did note that “Inflation is not over, and neither is the Fed’s battle against it.” However, he also mentioned, “we can now say for the first time that the disinflationary process has started.”
“It is a good thing that the disinflation that we have seen so far has not come at the expense of the labor market,” he also said.
Without any drastic surprises, Fed seems on track to pause tightening with two more 25bps rate hike.
EUR/USD breaks 1.0928 resistance decisively to resume the up trend from 0.9534. Near term outlook will remain bullish as long as 1.0800 support holds, in case of retreat. Next target is 61.8% projection of 0.9630 to 1.0733 from 1.0482 at 1.1164. The real test will lie in resistance zone between 1.0482 and 61.8% retracement of 1.2348 (2021 high) to 0.9534 at 1.1273. Attention should be paid to topping signal inside this 1.1164/1273 resistance zone.
