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My dude Powell is up this week!

What are markets expecting? More importantly, can he influence the dollar’s broader trends?

I’ve got the points you need to know if you’re trading the Greenback this week!

Powell’s speeches

  • Fed Chairman Jerome Powell will testify before the Senate Banking Committee and the House Financial Services Committee on Tuesday and Wednesday respectively
  • Markets expect Powell to balance his optimism for the economy with playing down the odds of tightening policies in the foreseeable future
  • Watch out for his thoughts on Biden’s current and future economic plans

2nd GDP reading (Feb 24, 1:30 pm GMT)

  • Uncle Sam is expected to have grown by 4.1% in Q4 2020, a bit higher than the 4.0% initial reading
  • Unless we see significant revisions, USD will likely follow its intraday trends

Other closely watched economic releases

  • CB consumer confidence (Feb 23, 3:00 pm GMT) to improve from 89.3 to 89.7
  • New home sales (Feb 24, 3:00 pm GMT) expected at 850K vs. 840K in December
  • Core durable goods orders (Feb 25, 1:30 pm GMT) could print at 0.5% (from 0.7%)
  • Initial jobless claims (Feb 25, 1:30 pm GMT) to slow down to 810K (from 861K)
  • Pending home sales (Feb 25, 1:30 pm GMT) seen at -0.4% after -0.3% read in December
  • Annualized core PCE price index (Feb 26, 1:30 pm GMT) to come in at 1.7% (from 1.5%)

Overall dollar demand

  • Continued vaccinations and stimulus discussions in the U.S. will improve Uncle Sam’s growth prospects and likely raise U.S. Treasury yields, U.S. equities prices, and dollar demand
  • USD’s gains may bow to the even bigger demand for higher-yielding currencies like GBP, NZD, CAD, AUD, and EUR
  • Hints of the Fed tightening in the foreseeable future can limit risk-taking and boost USD demand

Technical snapshot

  • Bollinger Bands consider the dollar “oversold” against the Kiwi and Aussie
  • USD is also approaching oversold levels against GBP
  • EUR/USD remains neutral on the daily time frame
USD Forex Pairs Bollinger Bands from MarketMilk
USD Forex Pairs Bollinger Bands from MarketMilk
  • Simple moving averages show the dollar’s short and long-term bearish trends against the comdolls and the pound
  • EUR/USD may soon see retracement or reversal opportunities
  • USD/CHF is still trading below the 200 SMA but is bullish against shorter-term moving averages
USD Forex Pairs SMAs from MarketMilk
USD Forex Pairs SMAs from MarketMilk
  • The dollar was most volatile against the comdolls and the pound in the last seven days
USD Forex Pairs Volatility from MarketMilk
USD Forex Pairs Volatility from MarketMilk

Missed last week’s price action? Read USD’s price recap for Feb. 15 – 19!