THIS WEEK’S CALENDAR IS FULL OF DRIVERS WITH HEAVY EUROPE, US FOCUS

This week’s economic calendar opens up a bit as we have a number of high-impact releases on the docket. Of particular interest will be a batch of Euro prints on Tuesday and Wednesday along with a series of US Dollar related-items spattered throughout the week. Out of the US, the big item is Mr. Jerome Powell’s Humphrey Hawkins testimony or the ‘semiannual monetary report to Congress.’ This will take place on Wednesday and Thursday, and we’ll see Mr. Powell deliver some prepared remarks before taking questions from both sides of Congress (the House is on Wednesday, the Senate on Thursday).

The high-impact events on this week’s economic calendar are listed below, all times in Eastern.

DAILYFX ECONOMIC CALENDAR – WEEK OF FEBRUARY 26, 2018

US DOLLAR – BULLISH CONTINUATION OR RETURN OF THE BEARS?

The big Forex item from last week was strength in the US Dollar. The Friday before last week saw a bullish engulfing candlestick form off of fresh three-year lows, and that strength continued for most of last week. On Friday, we looked at the initial stages of congestion after DXY tried to take out the 90.00 level, and this led to a bull pennant formation on the hourly chart.

After gapping higher and then testing the 90.00 level shortly after this week’s open, the Dollar trickled-below support to help produce fresh short-term lows. But, a bit of strength has started to show ahead of the US open, and prices are now pushing back towards prior points of short-term resistance.

US DOLLAR HOURLY CHART: PENNANT STARTING TO GIVE WAY AS VOLATILITY BUILDS AROUND USD

Chart prepared by James Stanley

THE BEARISH SIDE OF USD

The bearish argument behind the US Dollar as we open this week would be looking for a continuation of the trend that’s been in place for a year now, looking at last week as a blip in the radar that can allow for short-side positioning driven by the expectation for that trend to keep going.