The dollar continues to drop versus the Euro on the short term as the US data have come in worse than expected. EUR/USD has jumped above the 1.6000 psychological level and it is almost to reach a very important dynamic resistance.

The pair has managed to erase the yesterday’s losses and to climb above an upside obstacle. It should increase further as long as the USDX will drop further.

The dollar index has plunged and most likely it will resume the bearish movement and will force the USD to depreciate versus all its rivals. USDX increased in the yesterday’s trading session and it has only retested a broken dynamic support.

The USD plunged also after the FED Chair Powell speech titled “Monetary Policy in a Changing Economy” at the Federal Reserve Bank of Kansas City Economic Policy Symposium, in Jackson Hole.

Moreover, the Core Durable Goods Orders rose only by 0.2%, less versus the 0.5% estimate, the indicator has remained steady at 0.2% growth for the second month in July. The Durable Goods Orders dropped by 1.7%, more versus the 0.7% estimate.

The rate is almost to reach the downside 50% Fibonacci line of the major descending pitchfork where it could find temporary resistance again. I’ve told you in the previous report that a valid breakout above the median line (ml) of the minor ascending pitchfork it will announce a further increase.

It remains to see how it will react when it will hit the 50% line and if it will stabilize above the median line (ml).

One thing is certain right now that the rate will increase further as long as the USDX will continue to drop. The USDX could approach the 94.50 and the 94.00 psychological level, so the EUR/USD could reach at least the 1.7000 psychological level.