EUR/USD Current price: 1.2389
- ECB's Draghi reiterates that rates will remain low for a long time.
- US Retail Sales fell for a second consecutive month, down on February 0.1%.
The EUR/USD pair came under selling pressure at the beginning of the European session, undermined by comments from ECB's head, Draghi, later reinforce but another member of the central bank, Benoit Coeure. Draghi said that inflation is moving into the right direction, but still far below their target, somehow hinting that trimming QE is not yet under consideration, and repeating that rates will remain low for a long time. Coeure, in the meantime, repeated that inflation is not yet at the desired level. In the data front, German inflation matched estimates in February, with the release passing unnoticed, while the EU Industrial Production disappointed by falling by more-than-expected, down 1.0% in January vs. market's expectations of -0.4%.
The pair retreated from its daily highs around 1.2410 to the 1.2360 price zone but recovered ahead of the release of US Retail Sales. The numbers disappointed, as sales fell 0.1% in February, against an expected 0.3% advance, while the control group sales resulted at 0.1%, well below market's forecast of 0.4%. The US also released its February PPI, up for the month 0.2% and by 2.8% YoY. The market barely reacted to the news, but for sure, news are not good for the greenback.
The EUR/USD pair's 4 hours chart shows that it managed to hold above the 23.6% retracement of the previous two weeks' rally, around 1.2375 also above all of the moving averages, with the 20 SMA gaining upward traction and about to surpass the 200 SMA. Technical indicators in the mentioned chart remain within positive territory, losing their earlier downward slopes, somehow indicating that selling interest is limited. The pair would need to accelerate below 1.2410 to extend its gains now towards 1.2445, the high set last week, en route to the 1.2480 a strong static resistance area.
Support levels: 1.2360 1.2320 1.2280
Resistance levels: 1.2410 1.2445 1.2480
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