The U. S. dollar ticked slightly higher Wednesday and sent both of our major currency pairs to short-term support levels which have proved to hold so far.
Elsewhere, we got a profitable breakout in the DAX yesterday after the 15700-support level was significantly breached to the downside. Our short entry at 15790 has thus proved highly profitable. Lower supports are now seen at 15430 and 15300.
It’s decision day at the European Central Bank. The European economy is growing faster than was anticipated, but is it enough for policy makers to phase out the central bank’s crisis support? Maybe, but maybe not at this time. The ECB is seen to have more flexibility than the Federal Reserve in maneuvering monetary policy. ECB policy makers could thus be on track to retain the current policy. For the euro to rise it would require a clear exit strategy and a material shift in the ECB’s forward guidance. If the central bank retains its current monetary policy path, the euro could fall on disappointment.
Generally speaking, we do not expect fireworks today. We will prepare for potential price breakouts but do not anticipate exaggerated movements.
The most interesting part for traders will be ECB President Christine Lagarde’s press conference due at 12:30 UTC.
The pair has been in a downward trend channel since May 2021. Based on that channel we anticipate lower targets to be at 1.1750 and 1.17. Euro bulls on the other side should watch out for a break above 1.1910 in order to buy euros towards 1.1980.
- Subscribe to our daily signal service
We wish you good trades!
Any and all liability of the author is excluded.
Copyright © All Rights Reserved 2021 MaiMarFX.
Follow us on social media: