As foreseen, ECB did not change its interest rate for many reasons. First Draghi has to see the effect of the former decision to lower the interest rate in the market. And yet it is too early to see the impact. Second, issue is that there is still cheap money in the market and no risk of inflation. Therefore, the parameter will not change on the short term basis. FED decided not to increase its interest rate before 1Q13, which gives a lot of room for Euro and BULL on the upside. The headline goal remain the same. The correction is rather normal because of ECB statement and overall because we did reach an overbought level. You can compare the analysis with the previous one.
Concerning EUR DXY which is US Dollar Index, there is a contradictory correlation because when DXY is up, EURUSD pair should be down. The correlation may be very much with USDEUR and DXY may be.
At the present we are in an equilibrium among EURUSD and DXY.
Pashabxl
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Dear FX_Lab_Pro, it doesn't yet affect my forecast, to the contrary. It would have affected my forecast if FED was planning to increase the interest rate during 4Q14 but that would not yet be the case. Therefore, The downside of Euro still remain 1.3600-1.3585, which is a little correction based on ECB statements, but nothing more then that, and bare in mind that QE3 is still on until Oct 14, i.e USD is being "printed" so on monetary mass, it is still in the side of EUR as the strong currency.
FX_LAB_PRO
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EUR is almost following the DXY. After DXY breakout of downtrend channel, what do you thing it will affect EUR?
FX_LAB_PRO
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and the rsi now is also under 50. any affect to your forecast?
Pashabxl
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You are very right Yeru, I was meaning 1Q2015 and I miss write the date. Very sorry.
At the present we are in an equilibrium among EURUSD and DXY.