The ECB may extend the beyond Sep 2016 and choose to continue till Mar 2017. Market are expecting to increase the monthly bond purchase by €10bn and to add €500 billion of asset purchases on the top of original €1.14 trillion
The is expected to slash deposit rates further by 10 to 20 bpbs.
If ECB kept its deposit rates unchanged - EUR/USD is expected to move slightly higher and we can use this opportunity for entering fresh shorts.
The pair’s major intraday resistance is around 1.0640 and break above targets 1.0690.
It is good to sell on rallies around 1.0690 with SL around 1.0730 for the TP of 1.0550.
If ECB cuts deposit rate by 10 -20 bpbs or more than expected deposit rate cuts will drag the pair till 1.0460/1.0400.
It is good to sell below 1.0550 with SL around 1.0650 for the TP of 1.0460/1.0400