EUR/USD rallied after the Yellen’s speech and is almost to reach the 1.1909 previous high. I’ve said in the previous articles that the perspective remains bullish on this pair, so the current rally is natural. It is located in the green zone and could hit fresh new highs in the upcoming hours, but remains to see what will bring the ECB President Draghi’s speech.

You should be careful because we may have a high volatility later, and you don’t want to suffer a heavy loss. Price rallied as the USDX is almost to reach the 92.55 previous low, will drop towards fresh new lows if will close below this level.

USDX plunged after the yesterday’s minor increase and touched the 250% Fibonacci line (ascending dotted line). A valid breakdown below this level will open the door for more declines, the next targets will be at the 92.55 and lower at the 92.49 long term static support.

I’ve said in the previous weeks that the rate could move sideways on the short term before will really start a broader rebound, but a breakdown below the 92.55 previous low will invalidate a potential larger bounce back.

The USD dropped on the Yellen’s speech, unfortunately, the Durable Goods Orders have dropped more than expected, the indicator registered a 6.8% drop, more versus the 6.0% estimate. The greenback received a helping hand only from the Core Durable Goods Orders, which has increased by 0.5%, beating the 0.4% estimate, but wasn’t enough to save it from downside.

Price rallies and could hit the upper median line (uml) of the ascending pitchfork,where he could find temporary resistance again. Is approaching also the 1.1909 previous high, a failure to close above the mentioned levels will signal an exhaustion and a potential drop.

The next major upside target will be at the 1.2042 level, there we have a former swing low, could take this out if the dollar index will stabilize under the 92.49 major static support.