The ECB is about to announce its policy decision!
Will this mean more gains for the euro or will Lagarde disappoint?
Here are the breakout levels I’m watching.
Before moving on, ICYMI, yesterday’s watchlist looked at a trend breakdown and retest on EUR/GBP. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
U.S. EIA crude oil inventories post surprise build of 2 million barrels
Chinese trade surplus widened from $51.1B to $78.8B
French final private payrolls unchanged at 0.3% gain as expected
Japanese preliminary machine tool orders increased by 23.7% y/y
Another district in Shanghai facing lockdown on COVID-19 mass testing
Asian shares wobble ahead of possible hawkish ECB tilt
Upcoming Potential Catalysts on the Forex Economic Calendar:
ECB monetary policy statement at 11:45 am GMT
ECB press conference at 12:30 pm GMT
U.S. initial jobless claims at 12:30 pm GMT
BOC Governor Macklem’s speech at 3:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: EUR/USD
All eyes and ears are on the ECB statement today!
Will they finally hike interest rates this time or not?
While the general consensus is for policymakers to sit on their hands for the time being, many are also expecting to hear stronger hints of a tightening move coming in July.
If they do surprise with an actual hike or suggest that they’d pull the trigger next month, the shared currency might be in for a rally!
I’m keeping close tabs on this symmetrical triangle consolidation pattern on EUR/USD since it could break out in either direction. After all, technical indicators are giving mixed signals at the moment.
The 100 SMA is below the 200 SMA to suggest that the path of least resistance is to the downside, but Stochastic appears to be pulling higher from the oversold region.
In any case, a breakout could be followed by a rally or a selloff that’s the same height as the triangle, which spans roughly 150 pips.
