The EUR/USD pair is under selling pressure ahead of the main event of the day, the ECB's economic policy decision. The pair fell down to fresh weekly lows, down to 1.1301 with the European opening, and is having a hard time to bounce back to its comfort zone around 1.1340/50.
The European Central Bank is generally expected to maintain its ongoing economic policy unchanged, although lately, investors have been speculating Mario Draghi may announce an extension of their QE, as after ten months of easing, inflation in the EU fell below zero, far from the 2.0% target of the Central Bank. Nevertheless, Super Mario will likely offer a dovish stance, and will likely try to down talk the EUR.
View the Live chart of the EUR/USD
In the meantime, the technical picture according to the 4 hours chart supports a continued decline, as the price accelerated below a bearish 20 SMA, whilst the technical indicators turned south around their mid-lines. Also, the pair is pressuring the base of this week's range, which increases chances of a downward break. The upcoming movements however, will depend on how the market takes the ECB decision.
The pair has an immediate support at the 1.1280 price zone, which means a break below should lead to a quick slide down to 1.1240, whilst below this one, the 1.1180/1.1200 region comes next. To the upside, the pair needs now to recover above 1.1350 to be able to retest the top of the weekly range at 1.1400, with a strong break above it signaling a probable continuation rally up to 1.1460.
Latest updates on the EUR/USD Forecast
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