We have the Euro area interest rate decision day today, which should, potentially, give us a more interesting day than yesterday.
It is expected that the rate will stay the same. The only thing that is bothering me are the major news channels that are not talking about the potential rate hike. We have Central Banks in North America already raising their rates, so now it's the question, when will ECB follow? I am a strong believer in surprises, as they create more chaos, from which the "big guys" can profit easily.
Yesterday, EURUSD had a great run, clearing at least 100 pips to the upside. Today, either we will get a continuation or there will be decent retracement. Considering the fact that we are in an uptrend, potentially, if we start seeing a break of yesterday's high of 1.24593, then we could see higher levels made, especially the psychological 1.25, which everyone is expecting.
But because everyone is expecting Draghi to push the Euro higher towards the 1.25 and above, that's why my skepticism is kicking in. The DXY had already a massive sell-off over a the past few days, so we could potentially see some BUYers jumping into it for a quick retracement. I don't believe that the USD is so unattractive at the moment and that there is no value in it. If BUYers will start jumping in back into the greenback today, then it will play out nicely with the EURUSD.
From the technical side, the EURUSD has this nice strong trendline on the 240 min chart, that would be ideal for a test. You should watch the levels at around 1.23250 and 1.23000, which could become significant "magnets" for a re-test. But if we will start seeing reversals soon, that will be getting closer to yesterday's high, then the Euro is strong and the USD is still weak.
Have your own head in this, don't trade during Draghi speach and keep an eye on the price action!
It is expected that the rate will stay the same. The only thing that is bothering me are the major news channels that are not talking about the potential rate hike. We have Central Banks in North America already raising their rates, so now it's the question, when will ECB follow? I am a strong believer in surprises, as they create more chaos, from which the "big guys" can profit easily.
Yesterday, EURUSD had a great run, clearing at least 100 pips to the upside. Today, either we will get a continuation or there will be decent retracement. Considering the fact that we are in an uptrend, potentially, if we start seeing a break of yesterday's high of 1.24593, then we could see higher levels made, especially the psychological 1.25, which everyone is expecting.
But because everyone is expecting Draghi to push the Euro higher towards the 1.25 and above, that's why my skepticism is kicking in. The DXY had already a massive sell-off over a the past few days, so we could potentially see some BUYers jumping into it for a quick retracement. I don't believe that the USD is so unattractive at the moment and that there is no value in it. If BUYers will start jumping in back into the greenback today, then it will play out nicely with the EURUSD.
From the technical side, the EURUSD has this nice strong trendline on the 240 min chart, that would be ideal for a test. You should watch the levels at around 1.23250 and 1.23000, which could become significant "magnets" for a re-test. But if we will start seeing reversals soon, that will be getting closer to yesterday's high, then the Euro is strong and the USD is still weak.
Have your own head in this, don't trade during Draghi speach and keep an eye on the price action!