EUR futures: rally appears well and sound, ECB begs caution

According to CME Group, Monday’s preliminary data showed open interest decreased by nearly 3.9K contracts vs. Friday’s final 432,473 contracts. In addition, volume dropped for the second day in a row by more than 65K contracts.

EUR/USD now targets 1.1616

Market participants might well ignore yesterday’s doji-ish candle, as the pattern was accompanied by dwindling volume and open interest, hinting at the idea that the ‘indecision’ should not be sustainable, let alone have a noticeable influence on spot.

The rally, however, could enter into a cautious-mode ahead of the key ECB meeting on Thursday, where market participants seem to be (quite) biased towards some kind of announcement by the central bank regarding its QE programme.

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