EUR/USD has rallied in the last hours and now it is traded at the 1.1793 level far above today's low at 1.1735. The sell-off in the US dollar index forced the pair to increase. We have a strong negative correlation between DXY and EUR/USD. The currency pair increases when the US Dollar Index drops.
USD started to depreciate on Fed Chair Powell remarks at the Jackson Hole Symposium. The US Revised UoM Consumer Sentiment increased only to 70.3 from 70.2, even though specialists expected an increase to 70.9. The Core PCE Price Index has increased by 0.3% as expected. Moreover, the Goods Trade Balance, Personal Income, and the Prelim Wholesale Inventories have come in better than expected.
EUR/USD Upwards Momentum
EUR/USD has increased and it has finally reached the ascending pitchfork's median line (ml). The median line represents a dynamic resistance. Only a valid breakout above it could signal a strong upward movement.
EUR/USD was somehow expected to increase towards the median line (ml) after registering a major bullish engulfing right on the lower median line (lml). Also, its breakout from the minor Falling Wedge signaled an upside reversal in the short term.
Forecast
Jumping and closing above today's high at 1.1802 and making a valid breakout above the median line (ml) could signal that EUR/USD could increase towards the upper median line (UML). The UML is seen as major dynamic resistance, a breakout could signal a larger upwards movement.
