When the President of the ECB Mario Draghi stated the readiness of the Regulator to extend its Quantitative Easing Programme, the EUR/USD pair lost more than 300 points within two days.
Today, at the opening of the trading session, the pair was trying to strengthen but was negatively affected by the IFO Current Assessment statistics for October, released in Germany. The indicator declined and came in below the forecast.
The ECB is likely to start stimulating the EU economy as early as December. The chances of this decision would rise to a maximum if the Fed keeps its interest rate unchanged at the forthcoming meeting.
Support and resistance
The EUR/USD pair broke down the lower line of a narrowing triangle on the at the level of 1.1050, which is also the lower border of an upward channel on the weekly chart.
OsMA and on the daily, weekly and monthly charts are giving sell signals. On the 4-hour chart, the indicators are turning to long positions.
The pair is likely to continue declining towards 1.0860, 1.0820 (July lows) and 1.0500 (year lows).
If the Fed keeps its interest rate unchanged at the forthcoming meeting, the pair may strengthen during an upward correction, but no higher than 1.1255 (EMA144), 1.1285 (23.6% Fibonacci), 1.1380 (EMA200 on the ).
Support levels: 1.1000, 1.0900, 1.0850.
Resistance levels: 1.1120, 1.1255, 1.1285, 1.1380.
Place pending Sell Stop orders at the level of 1.0985 with targets at 1.0910, 1.0860, 1.0820 and stop-loss at 1.1055.
Place pending Buy Stop orders at the level of 1.1065 with targets at 1.1100, 1.1150, 1.1200, 1.1250 and stop-loss at 1.1020.