EUR/GBP recovers losses, Draghi not really dovish?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 21, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - The EUR/GBP pair found bids at the 5-DMA at 0.7643 and now trades moderately positive on the day around 0.7685.

    Draghi effect fading

    Draghi’s dovish comments today were largely similar to the ones he echoed in late October last year. Back then, the EUR took a beating across the board. The EUR/GBP had dropped almost 150 pips on Oct 22nd after Draghi hinted at more stimulus in December.

    However, similar comments today hardly had any impact, especially since the cross could not even take out the 5-DMA support. This creates an impression the markets believe Draghi will not walk the talk.

    EUR/GBP Technical Levels

    A break below the immediate support at 50.7643 (5-DMA) would expose the 10-DMA located at 0.7590. On the other hand, a break above 0.77 handle would open doors for a re-test of the previous day’s high of 0.7755.
    For more information, read our latest forex news.

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