EUR/USD - Will ECB minutes re-establish the uptrend, Descending triangle noted?


EUR/USD found takers at the 20-day low of 1.1681 and ran into rising trend line hurdle after the Fed minutes released in the NY session showed growing concerns among policymakers about weak inflation.

Data heavy day, focus on the ECB minutes

The currency pair closed at 1.1766 and extended gains 1.1790 in the Asian session. The key data due for release are - Eurozone July final CPI at 9:00 GMT, Eurozone trade balance at 10:00 GMT, ECB minutes at 11:30 GMT. Across the pond, weekly jobless claims will be released at 12:30 GMT, followed by industrial production at 13:15 GMT and Fed’s Kaplan speech at 16:30 GMT. Sounds like a data heavy data, although the main event for the day is the ECB minutes release. 

ECB minutes - watch out for comments on the exchange rate

The minutes due today are expected to shed more light on the discussion that took place within the governing council on inflation outlook, potential QE taper and the impact of the recent Euro appreciation on growth and inflation. 

On the inflation front, the minutes are likely to reiterate Draghi’s view that there are no convincing signs of a pickup in price pressure and that inflation currently stands well below the central bank’s target. 

Coming to exchange rate, the minutes are more likely to say that a strong Euro could cap inflation, but is also a sign of growing confidence in the Eurozone economy. Finally, more clues regarding a potential QE taper in September/October could move the EUR pairs as well. 

The bulls may regain control of the EUR/USD if the minutes hint at the September QE taper and sound upbeat on inflation and economy. On the other hand, bears may come-in strong if the minutes highlight concerns regarding weak inflation and EUR strength. Moreover, it would mean the ECB could delay the QE taper. 

EUR/USD Technical Levels

The daily chart shows a descending triangle formation, which are typically continuation patterns. However, at times the descending triangles have worked as bearish reversal patterns as well. 

A break above 1.1812 [triangle hurdle] would open up upside towards 1.1848 [Aug 11 high], above which a major hurdle is seen at 1.1910 [recent high]. On the downside, breach of support at 1.1765 [Asian session low] could yield 1.1687 [triangle support]. An end of the day close below the same would signal trend reversal and open doors for 1.15 levels. 

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD stays sidelined around 1.1650, monthly resistance line in focus

EUR/USD picks up bids to 1.1642, keeping the two-day advances intact during the early Asian session on Monday. The currency major pair stays firmer above 10-day and 21-day EMAs amid bullish MACD signals. August month’s low adds to the upside filters.

EUR/USD News

GBP/USD treads water near 1.3800 after mixed UK data

GBP/USD came under bearish pressure in the early European session after the data from the UK showed an unexpected contraction in September Retail Sales. However, the British pound managed to pare its losses with the Markit PMI figures surpassing analysts' estimates.

GBP/USD News

Gold: Bears lurking at weekly trendline resistance

The price of gold has been supported by a dynamic weekly/daily trendline where bulls consolidated and finally made a break for the upside in the latter part of the week. The price move into the $1,800s but has failed to take out the weekly trendline resistant, so far. 

Gold News

Crypto bulls unfazed by flash crash

BTC closed more than 5% lower on the Thursday session, but buyers have stepped in to hold the Tenkan-Sen as support. ETH action shows that the recent rejection has caused some indecision. XRP does not have far to move to initiate a massive bullish breakout.

Read more

Apple talks over battery supplies for EV stall-Reuters

Apple (AAPL) is on a steady move higher ahead of results next week. We have had solid earnings from big names already such as Tesla (TSLA) and Netflix (NFLX), but Apple is the biggest one of all and will be the highlight of the earnings season for many.

Read more

Forex MAJORS

Cryptocurrencies

Signatures