EUR/USD is trading in the green and it tries to climb higher in the short term as the USD is weaker after the FOMC. The dollar decreases as the USDX has reached new lows, but it remains to see what will happen after the ECB.
The ECB is expected to maintain the Main Refinancing Rate steady at 0.00%. However, a dovish speech could force the pair to decrease again and to resume the downtrend. EUR/USD is trapped within a range in the short term, but I really hope that we’ll have a clear direction after ECB. You should be careful because the ECB Press Conference could bring high volatility.
EUR/USD increases and it could climb higher after the false breakdown with a great separation below the 1.0777 level. Technically, the price is somehow expected to increase and to approach the 1.1 and the median line (ML) again after the failure to reach and retest the lower median line (LML).
A larger upside movement will be confirmed only after a valid breakout above the median line (ML). The USD drops only because the US has reported some poor economic figures in the last weeks and not because the EUR is stronger these days.
- TRADING TIPS
The false breakdown below the 1.0777 static support has signaled a potential increase towards the 1.1000 level and towards the median line (ML). A valid breakout above the median line (ML) and above the 1.1 will give us a great chance to go long again with targets at the 1.1200 – 1.1215 and at the upper median line (UML).
EUR/USD remains under pressure as long as it is traded below the median line (ML), so it could drop anytime again if the USDX gives birth to another bullish momentum. The pair could plunge if the ECB announces new stimulus measures to fight the COVID-19 effects on the eurozone economy.
A larger drop will be validated after the price will decrease and close below the 1.0635 low and after a valid breakdown below the lower median line (LML).