Global macro overview for 11/10/2017

Global macro overview for 11/10/2017:

The event of the day is the September's Fed Meeting Minutes release accompanied by the publication of new projections and the Chairperson Jannet Yellen conference. For this reason, attention will be focused primarily on the distribution of forces between the supporters of the thesis that the weakness of inflation being temporary, and decision makers suggesting a continuation of monetary tightening. The market reaction should not be strong, as the market focuses on the successor of Janet Yellen in the Fed chairman's chair. The leading candidates are Powell and Warsh and the verdict of Trump is to be announced even this coming Friday. The latter would be more favorable to the US Dollar, as Warsh is perceived as a fierce critic of quantitative loosening and a person concerned by excessively loose financial conditions in the economy. Regardless of this factor, economists remain positive about the Dollar. The main driver of its appreciation will be the reflection of inflation indicators.

Let's now take a look at the US Dollar Index technical picture at the H4 time frame. After breaking out of the Falling Wedge formation, the price has bounced from technical support at the level of 92.95 and currently is trading within the narrow zone between the levels of 92.95 - 93.35. The market conditions are starting to become oversold, but the momentum indicator still points to the downside. In a case of a further downside extension, the next technical support is seen at the level of 92.67.


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