FXStreet (Guatemala) – EUR/USD is positioned just below the key and psychological 1.13 handle while highs were made overnight in choppy European and US sessions.
The high of 1.1325 was a spike on a negative stick by the close on the hourly charts albeit supported by the rising 20 SMA on the same time frame with price now better bid again. The key events today were with the Central Banks.
The ECB account of the monetary policy meeting was dovish while concerns were over the Global economy and EM’s and subsequent downside risks of inflation thus reminding markets that QE is firmly in place and gives rise to speculation that the ECB may need to increase their easing policies further. Then, we had the FOMC minutes that were showing that most members were in favour of a rate hike this year.
EUR/USD neutral/bullish near term; 1.1250 is key support
Technically, the cloud top at 1.1313 was targeted, but the move to the highs were short-lived and lacked conviction. 1.1420 is some way off still, but a bullish picture is emerging although price is lacking momentum and directional strength short-term. The golden cross was made at 1.1168 at the start of the month supporting the bullish outlook longer term.
However, Valeria Bednarik, chief analyst at FXStreet explained, ” As long as the price holds above the 1.1250 level, the downside seems limited, yet a break below it should be pretty discouraging for bulls, and anticipate some further intraday declines for this Friday”
(Market News Provided by FXstreet)