In our Daily Trade Watch video, we look for high probability trade setups that we can trade throughout the day. Today, we discuss how pressure on ECB could push euro lower.
You may already be aware that yesterday the FED decreased interest rates by 0.50%, reducing rates to 1.25%. This is now believed to potentially be the catalyst for other central banks to follow suit. As a result, we anticipate the ECB at next Thursday’s rate decision and press conference to act in some form of coordinated manner by either reducing rates further from the solid base of zero like in Japan and Switzerland. Additionally, it could put in place further stimulus package to try and put a floor under these markets and provide confidence despite the fears and anxieties around the ongoing coronavirus outbreak and the devastating impact it may have.
This works nicely with the technicals. We have just seen the EURUSD move over 500 pips to the upside over the last two weeks and now we are getting the potential selling signals to begin to kick in. Therefore, if prices break below yesterday’s and Tuesday’s low of 1.1094, then we would expect this market to push lower. It must be noted, however, that on Friday we have NFP data released which could help or hinder the progress of this trade so bear this in mind.
Pressure on ECB Could Push Euro Lower – Full Video Analysis
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