“The dollar will get stronger,” helped the U.S. dollar today.
The EUR/USD has been drifting slowly lower to trade as low as 1.2339. Meanwhile, the U.S. bond yields are soaring. The 10-year Treasury yield trades above 2.7%, which is the highest level since 2014. The ECB hit the wires earlier today. Praet said that the ECB was still away from meeting its inflation goal, suggesting that the QE would continue for some time. This is not a good message for the euro bulls.
Last week, the euro recovered much of its losses after the strong dollar talk and reclaimed the 1.25 handle before settling at around 1.2420. However, the 1.2420 – 1.2430 area has now become the resistance.
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