Description
⋅ The ECB raised rates this week. The Euro fell.
The market has priced in this week's rate hike as the last. It thinks the ECB is done.
Judging by current Euro Area inflation, there are more rate hikes to come.
What does this mean? A stronger Euro, which is not currently priced in.
Keep an eye on Euro Area inflation figures. If inflation continues to be sticky or unexpectedly rises, EUR pairs may rally. Possible explosive upside.
In my opinion, the ECB is not done with their rate hiking cycle yet. There is more to come.