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.