Karen Jones, expert at Commerzbank, assesses the cross has “executed a return to point of break out from the symmetrical triangle. This is very negative price action. The triangle break down point is expected to offer resistance at 1.2879 and we would expect prices to be contained by the near term downtrend at 1.2950”. The analyst also remarks that this technical pattern would point to a descent towards the 1.2470 region.
In the same tone, Chief Analyst A.L.Rasmussen at Danske Bank comments “Considering that the market is not speculatively short EUR/USD to the same degree as was the case two months ago and the quite dovish Drahgi comments yesterday, further downside for EUR/USD is likely short term. We do not expect anything from the ECB today, but risk is tilted towards a more soft ECB
After Draghi’s comments on Wednesday and the European Commission revisions of the growth prospects in both Germany and the euro zone, Senior Strategist at Rabobank Jane Foley sees “While the market does not expect the ECB to announce any further fresh policy incentive today, we do expect that the door will be left open for another rate cut; despite speculation that the prevalence of ample liquidity means that the marginal impact of another move may be slight. Fears that the ECB may have little fresh ammunition in its arsenal and the deteriorating economic climate in the Eurozone should keep the EUR on the back foot”.