5 Mar 2015
EUR/USD dropped below the 1.10 level - FXStreet
FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet explained that the EUR/USD pair has slid temporally below the 1.1000 level this Thursday, following the ECB latest monetary policy meeting.
Key Quotes:
"As suspected, the Central Bank will start as soon as next Monday, March 9, to buy public sector bonds in the secondary market, while it will also continue its buying of ABS and covered bonds."
"As an exception, the ECB will not buy bonds with yields below the deposit rate, and because of the obvious reasons, it won't be buying Greek bonds."
"The surprise in Mr. Draghi's speech came from a strong upward review in GDP and inflation projections for the next three years, and from the fact that the Governing Council believes the euro area is already showing signs of improvement."
"The market's initial reaction to these words came in the form of a spike up to 1.1113 that was quickly reversed. The pair fell slowly but steady down to 1.0986, levels not seen since September 2003, before bouncing back above the 1.1000 level."
"Technically however, the short term picture continues to favor the downside, as the 1 hour chart shows that the price develops below its 20 SMA and that the technical indicators remain in negative territory, with the RSI barely bouncing from oversold levels."
"In the 4 hours chart, the 20 SMA extended lower, now offering dynamic resistance around the 1.1130 price zone, whilst the Momentum indicator stands directionless below 100 and the RSI maintains its bearish slope around 23. The market will likely remain on hold during the upcoming Asian session, waiting for US employment figures, to be released early Friday, before making next move."
Key Quotes:
"As suspected, the Central Bank will start as soon as next Monday, March 9, to buy public sector bonds in the secondary market, while it will also continue its buying of ABS and covered bonds."
"As an exception, the ECB will not buy bonds with yields below the deposit rate, and because of the obvious reasons, it won't be buying Greek bonds."
"The surprise in Mr. Draghi's speech came from a strong upward review in GDP and inflation projections for the next three years, and from the fact that the Governing Council believes the euro area is already showing signs of improvement."
"The market's initial reaction to these words came in the form of a spike up to 1.1113 that was quickly reversed. The pair fell slowly but steady down to 1.0986, levels not seen since September 2003, before bouncing back above the 1.1000 level."
"Technically however, the short term picture continues to favor the downside, as the 1 hour chart shows that the price develops below its 20 SMA and that the technical indicators remain in negative territory, with the RSI barely bouncing from oversold levels."
"In the 4 hours chart, the 20 SMA extended lower, now offering dynamic resistance around the 1.1130 price zone, whilst the Momentum indicator stands directionless below 100 and the RSI maintains its bearish slope around 23. The market will likely remain on hold during the upcoming Asian session, waiting for US employment figures, to be released early Friday, before making next move."