There hasn’t been much
movement in eur/usd
pair this week. It is neither rising, nor falling. No higher highs and no lower
lows. It means market is stuck and waiting for something. No wonder for what.
ECB rate decision is expected to be released at 11:45 GMT. No surprise is
expected. However, any slight hawkish or dovish comment can send the pair up to
previous high of 1.1697 (24th of August) or down to the low of
1.1151 (28th of August low) and possibly much lower. Either scenario
is possible, but downside is probably favored. Why?
ECB is not planning to raise
interest rates any time soon. FED is contemplating rate hike and this puts Euro
in a vulnerable position. It is probable that current run to 1.1700 level was
simply profit taking on short positions in Euro and a healthy counter trend
move that happens in any trending market. However, FED seems to be too slow in
their decisions and this can affect short term fall of US dollar. So, any sign
of bearish or bullish ECB comments will affect exchange rate of the pair
dramatically.
One other possible bullish
sign for Euro is that price broke below important 1.1233 level yesterday during
US session, but is going back above it now.
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