EUR/USD Analysis: flirting with multi-year lows
|EUR/USD Current price: 1.0937
- ECB announced a rate cut, open-ended QE as an “ample degree” of accommodation still needed.
- US data encouraging, core inflation revised higher in August.
- EUR/USD poised to extend its decline toward the 1.0840/60 price zone.
The EUR/USD pair collapsed below the 1.1000 figure and trades near its yearly low of 1.0926, following the European Central Bank monetary policy announcement. Draghi & Co. delivered, cutting rates by 10 basis points and reintroducing open-ended QE, announcing bond buying for €20 billion per month starting November 1st. The accompanying statement showed that policymakers dropped date-based forward guidance. Speaking in the press conference, Draghi said that an ample degree of accommodation is still needed
In the US, initial jobless claims for the week ended September 6 resulted at 204K, better than the 215K expected. Inflation in the world’s largest economy was up by 0.3% monthly basis and by 2.4% when compared to a year earlier, in August, net of food and energy prices. Despite far from impressive, the figures gave further support to the greenback.
EUR/USD short-term technical outlook
The EUR/USD pair touched the yearly low before bouncing a couple of pips, under strong selling pressure as President Draghi keeps speaking. The pair is technically bearish according to technical readings in the 4 hours chart, further plummeting below all of its moving averages, and with technical indicators heading firmly lower, entering oversold readings. A break through 1.0920 should favor an extension toward the 1.0840/60 price zone, the next relevant support area.
Support levels: 1.0920 1.0890 1.0850
Resistance levels: 1.0955 1.0990 1.1025
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.