EURO NEXT WEEK: ECB MUST DO SOMETHING TO FIGHT AGAINST DEFLATION.
I think ECB have no much time to wait anymore. Eurozone is indeed facing serious problems. doesn't pickup last month, IFO and ZEW report showed very negative data, and Industrial Production was very bad. Therefore, The ECB Meeting on Thursday is a good chance for ECB do something to promote EZ economy. I think there will be a big surprise in this meeting; no matter what ECB do, the result would be negative for Euro . Clearly, the trade of week is SHORT EURUSD and LONG USDCHF . It's very difficult for EURUSD to rally unless US Data is very bad, but I think the possibility of this case is small.
ECB still have one option on the table: Nuclear Weapon: Quantitative Easing , so they will press the button to trigger nuclear weapon ?????.
- Technical Analysis:
Look at on the chart, last week, we saw EURUSD pierced the two key supports at 1.2600 and 1.2500, this is frst signal.
The price rejected the I show on the chart 3 times: Second signals.
I see a standard and clear Head and Shoulder Pattern on the chart, and price went through the neckline of the pattern. Third signals.
All TA shows for EURUSD .
Combine FA +TA, I see there is a high possibility to SHORT EURUSD next week. I aim to 1.2300 level.
I reccommend a trade : SHORT EURUSD to 1.2300 , stop loss at 1.2600