EUR/USD holds above 1.0700, eyes on Powell

Early in the European session, the EUR/USD dipped around 1.0700 but held above it. Jerome Powell, the chairman of the FOMC, and other ECB officials are scheduled to speak to the public soon. Until then, the pair is unable to decide which way to go. The Fibonacci 61.8% retracement level of the most recent rise for the EUR/USD remains within touching distance, and the Relative Strength Index (RSI) indicator on the four-hour chart maintains an oversold reading below 30.
Yesterday, February 6, a moderately negative sentiment prevailed on global stock markets as investors were concerned about the prospect of further monetary policy tightening by the leading central banks. Thus, the head of the ECB Christine Lagarde said last week that in March the markets should expect another raise of 50 bp. She also stressed that the European regulator is prepared to set rates at any level for achieving the goal of 2% inflation in time. Head of the Federal Reserve System Jerome Powell, while noting that he sees signs of lowering price pressures, said that it is appropriate to continue raising rates. At the same time, strong January data on employment in the United States, which showed a jump in the number of jobs by more than half a million, showed on Friday that the Federal Reserve has all the arguments to maintain a tight monetary policy for a long time. We should also note that some pressure on stocks at the end of last week was put by disappointing reports from U.S. tech giants Amazon and Alphabet.

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