To add to the confusion, there was some kind of leak yesterday pre announcing 1,1 trillion EUR QE to take place between March 2015 and December 2016, making the EUR/USD pair swing between a 120 pips range in a matter of minutes. The same kind of volatility can be expected for today, with the market probably reacting first to the announcement itself, and later to Draghi’s words.
From a technical perspective, the pair maintains the overall ruling bearish trend, but that does not mean it can’t post a strong upward rally following the news. The key resistance level, will be 1.1680, yesterday’s high, where sellers are expected to cap the upside. If stops above it get triggered, the rally may extend up to 1.1730/50 the next line in the sand.
To the downside, the key support to follow is 1.1540, with a break below it exposing the pair to a sharp decline down to 1.1458 this month low. If this last gives up, the next strong long term support stands at 1.1370 with the pair probably testing it during the upcoming sessions.
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