11.02.201611:51 Forex Analysis & Reviews: Global macro overview for 11/02/2016

Global macro overview for 11/02/2016:

In her yesterday testimony, Fed Chair Jannet Yellen said that the central bank is unlikely to reverse its plan to hike interest rates further this year and the status of monetary policy remains accommodating. The Fed is actively monitoring the incoming economic data continuously assessing the levels of employment and federal fund rates in order to achieve the inflation target of 2%. In conclusion, the Fed is cautious and still applies the wait-and-see approach to the employment markets despite the continuous turmoil in the oils market and global economy headwinds. More interest rate hikes are still being seen as appropriate in the current economic conditions.

Let's now take a look at the technical picture of US dollar index at the daily chart following yesterday's events. The index has broken below the level of 21, 50 and the 100 daily moving average. Moreover, the old golden trend line has been violated as well and it looks like the index is heading towards the support level of 94.05. The daily trend is still bullish, but there are first indications of a possible reversal and more deeper corrective cycle.