EUR/USD retakes 1.0900 on Draghi

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 10, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    The single currency is now bouncing off session lows vs. the dollar, with EUR/USD regaining the 1.09 handle after testing the 1.0820 region.

    EUR/USD weaker on ECB easing

    The pair has reverted the initial offered tone following the announcement of additional stimulus from the European Central Bank at its meeting today.

    EUR has also suffered the lower GDP and inflation forecasts, as the central bank now sees the euro area expanding at an annual pace of 1.4% in 2016 (vs. 1.7% prev.), 1.7% in 2017 (vs. 1.9% prev.) and 1.8% in 2018.

    Regarding inflation, the ECB now expects consumer prices in the region to rise just 0.1% during the current year, down from previous forecasts at 1.0%.

    Draghi has also stressed that low levels will remain for the foreseeable future.

    EUR/USD levels to watch

    The pair is now losing 0.76% at 1.0920 facing the next support at 1.0800 (psychological level) ahead of 1.0777 (low Jan.21) and finally 1.0709 (2016 low Jan.5). On the upside, a breakout of 1.1043 (200-day sma) would expose 1.1101 (50% Fibo of 1.1379-1.0823) and then 1.1166 (38.2% Fibo of 1.1379-1.0823).
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