Despite the strong US GDP data published yesterday for the first quarter of this year, the US dollar reacted rather sluggishly to them, showing barely noticeable growth against the single European currency. We will return to the technical picture in more detail a little later, but for now, we will talk about yesterday's data and what indicators are expected today. So, yesterday, preliminary data on US GDP for the first quarter were published, which turned out to be better than the forecast of 6.1% and showed the growth of the world's leading economy by 6.4%. These reports once again convince us that the US economy shows a fairly intensive recovery from the effects of the COVID-19 pandemic. By the way, such impressive GDP growth in the first quarter, which was influenced by a significant increase in consumer spending, was last observed back in 1984. It would seem that such convincing statistics should support the US dollar and give it the status of a favorite in the foreign exchange market, but the "dovish" mood of the Federal Reserve System (FRS) crossed out the implementation of such a scenario.
Let me remind you that following its April meeting, the Federal Reserve's Open Market Committee did not make any changes to its monetary policy. At the same time, no one expected that the Federal Reserve would raise the refinancing rate. The main "dovish" tone was the statement about the immutability of the volume of programs for the purchase of bonds and mortgages over a long period. However, such soft comments of Powell and his associates can not be called unexpected. It is quite possible that investors have not yet fully digested the results of the extended April meeting of the Federal Reserve, and soon the situation in the foreign exchange market will change in favor of the US currency. Today, on the last day of April and weekly trading, we are waiting for a large volume of macroeconomic statistics from Europe and the United States. At 09:00 London time, the German GDP will be published. In an hour, reports on GDP and consumer prices in the eurozone will be released. At 13:30 (London time), statistics will begin to arrive from the United States, where special attention should be paid to Americans' personal income and expenses, as well as the basic price index of personal consumption expenditures. Well, now to the charts, namely, to the daily timeframe.
Daily
So, as a result of yesterday's trading, a Doji candle with relatively long and approximately equidistant shadows appeared on the EUR/USD daily chart. Since this candle appeared immediately after the big white one, there is a high probability that the upward trend has come to its end or a course correction is overdue and very significant. However, for more definite conclusions, it is necessary to see confirmation in the form of today's decline and the appearance of a full bearish candle. I fully assume that yesterday, against the background of strong reports on US GDP, the market was covered by a wave of uncertainty and indecision. Hence the appearance of such a candle. It is also impossible not to take into account the completion of monthly and weekly trading. At such moments, against the background of profit-taking, there is often some adjustment. From a technical point of view, the failed breakdown of the sellers' resistance at 1.2134 and yesterday's Doji candle is not conducive to opening purchases, especially on the last day of monthly and weekly trading. Sell positions are against the current trend, and yesterday's candle, to consider it a reversal, needs to be confirmed. Today, I suggest taking a wait-and-see position and seeing how the market will close April and the current week. On Monday, given the actual closure, hopefully, there will be more food for thought. In the meantime, let's wait.
