EURUSD, Daily
All eyes on the ECB. There is little doubt that Draghi will announce another QE program and that monthly purchase levels will be cut back from current EUR 60 bln a month. The main question is how much will be cut, and how long the new program will run? We initially expected a trimming to EUR 40 bln for 6 months, but it seems “less for longer” is gaining traction. A cut to EUR 20-30 bln a month and a duration of 9 months would open the way to a full phasing out of next asset purchases at the end of September next year. It seems likely though that Draghi won’t fully commit to a final end date yet, and deliver the net purchase reduction within a wider dovish framework of forward guidance that highlights again that rates won’t rise until well after the end of asset purchases, which would push the first rate hike out to 2019. Data releases won’t change the ECB outlook at this stage and we expect confidence readings including PMIs and Ifo to confirm that the recovery continues to broaden across countries and sectors.
EURUSD has slumped from its post Jackson Hole (August 25) induced rally high of over 1.2100 to October lows under 1.1700. Today its is again below the key 20 day moving average on the Daily chart finding some support in the 1.1740 -1.1700 zone. Resistance to a move higher is the now strongly established trend line and 38.2 Fibonacci retracement level at at 1.1830-40 zone.
Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.
Recommended Content
Editors’ Picks
AUD/USD: The hunt for the 0.7000 hurdle
AUD/USD quickly left behind Wednesday’s strong pullback and rose markedly past the 0.6900 barrier on Thursday, boosted by news of fresh stimulus in China as well as renewed weakness in the US Dollar.
EUR/USD refocuses its attention to 1.1200 and above
Rising appetite for the risk-associated assets, the offered stance in the Greenback and Chinese stimulus all contributed to the resurgence of the upside momentum in EUR/USD, which managed to retest the 1.1190 zone on Thursday.
Gold holding at higher ground at around $2,670
Gold breaks to new high of $2,673 on Thursday. Falling interest rates globally, intensifying geopolitical conflicts and heightened Fed easing bets are the main factors.
Bitcoin displays bullish signals amid supportive macroeconomic developments and growing institutional demand
Bitcoin (BTC) trades slightly up, around $64,000 on Thursday, following a rejection from the upper consolidation level of $64,700 the previous day. BTC’s price has been consolidating between $62,000 and $64,700 for the past week.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.