 Good morning and welcome to the Church of the Week video with me, David Madden. Today's date is Friday the 5th of March 2021 and the time has just gone 9.13 GMT. And this week's Church of the Week is the euro versus the US dollar, Euro dollar. As we can see here in the church, the wider term view has been quite positive. It racked up a multi-year high in early January, its highest level in over two years, going on three-year high. But since then, Euro dollar has been in a fairly clear dollar trend. We have the higher high, the higher low, the higher high. To be fair, the highs of February did manage briefly to take off the highs of January, but we have moved sharply lower yet again. In fact, this morning, we're actually back down to levels last seen in late November. Taking a look at the MACD histogram, the MACD indicator, we can see that there's been a steady rise in negative momentum. So the underlying currency pair is moving lower. We're also seeing a rise in negative momentum. So for the time being, the kind of momentum is with the bears. Why is this? Well, a lot of the moves I've asked recently has been actually to do with the rebound of the US dollar. The dollar was very weak at the beginning of the year and now it's firming up. Why is this? Well, we have seen a move higher in US government bond yields. We have seen yesterday the yield on the US 10-year government bond at its highest level since late February, which the highs of late February were a one-year high. This has all been fueled by a fear that higher inflation and growth is in the pipeline for the US. We heard yesterday from Jerome Powell, the head of the Federal Reserve, who essentially stated that he predicts the labor market in the US will take off as will growth. But with that, there's likely to be some temporary inflationary pressures as well. That's sent yields higher and in turn the US dollar higher as well. Also, the dollar has been benefiting a bit from the fight to quality play. Higher yields but pressure on stocks. So more money was poured into the dollar. So with that, we've seen added pressure on euro-dollar, hence why the euro-dollar has fallen to its lowest level since late November. Now, if we do move lower from here, because we're currently in a one-spot 1927, if we do move lower from here, we could head back down toward this zone here around 118. Not only was it 118, I think it's at the low point of mid-to-late-age in November, it also essentially coincides with this red line here, the 200-day moving average. It was also a decent barometer for a market, whether a market is strong or whether it's weak. We can see here all the way back in May, last summer, if that metric, the 200-day moving average acted both as resistance and support back then. So if the metric has been important in the past, it makes it more likely it will be important in the future. But what's also significant is that a fairly key support level here back in November also coincides with another important metric. So this makes it more likely that this zone in around one-spot 18 will be watched closely, because some people will be looking up for support levels, others will be looking up for moving averages to converge. It makes that price point potentially even more powerful, more in focus. If you do have a size of move below that, we can head back down towards the lows of early November in around one-spot 1745. And then below that again, it could take us back down towards the lows of the very early November down towards 116. On the upside, if you do manage to turn around the neuro-dollar, if you retake 120, we could be looking at heading back towards this yellow line here, the 100-day moving average, which acted nicely as support in early February. That comes into play in around one-spot 2029. Beyond that, we could be looking at retesting the fifth-day moving average, the blue line here in at one-spot 2131. What we really need to kind of take off the highs of late February in at one-spot 2242 to consider that, you know what, the kind of recent negative trend this bit here has come to an end, and the kind of road or wider trend is back in play. Now, if you are going to be trading neuro-dollar, it is worth your while keeping an eye on what's going on with the dollar itself. Here at CMC Markets, we offer a number of forex indices, which operate in the same fashion as the stock market index. In this way around, it is currency. So under the product list, you'll find the forex indices. You have the CMC USD index. As you can see here, it's moved higher. In fact, today, it hit its highest level since late December. So we're talking, you know, multi-molk highs being racked up on the US dollar index. So the dollar is only gaining against the euro, as you've seen. It's also gaining across a basket of other currencies across the board. So it could be about a break above a potentially significant level on the CMC USD index. Should that be the case, that could potentially send the dollar up towards the highs of late November in the kind of 970 area here on the CMC USD index. If that were to be the case, then you're likely to see further pressure, downward pressure, that is, on euro-dollar, because one of the tenants of dollar theories are the averages must confirm each other. And what that essentially means is that if a market's moving in a certain direction, similar markets are likely also to be moving in a similar direction. And if they are, you could then be more confident of the move. So for example, if euro-dollar is moving lower and you're seeing, you know, the dollar itself move higher, you could then be more confident that the negative move in the euro-dollar is going to continue. Also, today is a very important day in terms of economic announcements. It's the first Friday of the month, so that means it's US non-farm payrolls. That report is going to be announced at 13 to 30 GMT. For those of you watching this video in the morning time, you can actually sign up for our webinar. It's been hosted by my colleague Michael Houston. You can sign up for our website, cmcmarkets.com, under insights, under webinars and events. And that is free to join. And it begins at 1315 GMT. And then lastly, quickly show you on our platform where you can see our economic calendar. If you look at this kind of swiggy line here, which is a chart, click on that. Third option down, market calendar. As you can see here, it's in the calendar here, respecting the US non-farm payrolls. The boarders' survey is expecting 182,000 jobs to be created in the month of February. That's all from this video. Thank you for watching. Have a good training day and have a nice weekend.