EUR/USD steadies below 1.2200 following sharp fluctuations


  • EUR/USD remains on track to close little changed on Thursday.
  • ECB left its policy settings unchanged as expected.
  • US Dollar Index continues to hold above 90.00.

After staying calm below 1.2100 during the first half of the day, the EUR/USD pair fluctuated sharply as investors assessed the European Central Bank's (ECB) policy announcements. Following a sharp drop to a six-day low of 1.2144, the pair staged a rebound but lost its momentum before reclaiming 1.2200. As of writing, EUR/USD was virtually unchanged on the day at 1.2175.

ECB keeps status quo

Following its June policy meeting, the ECB decided to leave the interest rates on the main refinancing operations, the marginal lending facility and the deposit facility unchanged at 0.00%, 0.25% and -0.50%, respectively, as expected. The ECB also noted that it will maintain the total envelope of the Pandemic Emergency Purchase Programme (PEPP) at €1,850 billion until at least the end of March 2022.

During the press conference, ECB President Christine Lagarde said it was too early to talk about a 'PEPP exit' and added that there was broad agreement on the monetary policy decisions.

Citing sources familiar with the matter, Reuters reported that three ECB policymakers wanted to reduce the pace of the PEPP on improving economic prospects.

On the other hand, the data published by the US Bureau of Labor Statistics revealed on Thursday that inflation, as measured by the Consumer Price Index (CPI), climbed to 5% on a yearly basis in May from 4.2% in April. This reading beat the market expectation of 4.7% and helped the USD gather strength.

However, the greenback lost its strength with Wall Street's main indexes opening sharply higher and the S&P 500 Index reaching a new record high. At the moment, the US Dollar Index is posting small daily losses at 90.07.

Technical levels to watch for

EUR/USD

Overview
Today last price 1.2175
Today Daily Change -0.0006
Today Daily Change % -0.05
Today daily open 1.2181
 
Trends
Daily SMA20 1.2186
Daily SMA50 1.2075
Daily SMA100 1.2043
Daily SMA200 1.1989
 
Levels
Previous Daily High 1.2218
Previous Daily Low 1.2171
Previous Weekly High 1.2254
Previous Weekly Low 1.2104
Previous Monthly High 1.2266
Previous Monthly Low 1.1986
Daily Fibonacci 38.2% 1.22
Daily Fibonacci 61.8% 1.2189
Daily Pivot Point S1 1.2162
Daily Pivot Point S2 1.2143
Daily Pivot Point S3 1.2115
Daily Pivot Point R1 1.2209
Daily Pivot Point R2 1.2237
Daily Pivot Point R3 1.2256

 

 

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