The European Central Bank (ECB) President Mario Draghi’s speech is expected to be closely eyed in a data-light European session ahead.
Draghi is due to deliver the opening address at the ECB conference on Central, Eastern, and South-Eastern European countries (CESEE).?", in Frankfurt. The conference is based on the theme of "Resilience to global headwinds. His speech is scheduled at 0815 GMT and is expected to last for about 15 minutes.
How could it impact EUR/USD?
According to Omkar Godbole, Analyst at FXStreet, “the yield differential will likely narrow in the EUR-positive manner, helping the EUR/USD pair capitalize on Friday’s bullish breakout if the European Central Bank (ECB) President Draghi sounds less dovish during his speech at 08:15 GMT today. The central bank said last week that it would delay its first post-crisis rate hike until the middle of next year and Draghi offered to pay banks if they pass on the cash borrowed from the ECB to households and firms. The gains in the EUR/USD, however, will likely be short-lived, if the US reports a better-than-expected consumer price inflation for May at 12:30 GMT today.”
Meanwhile, “the Technical Confluences Indicator shows that EUR/USD is hovering above a dense cluster of support lines at 1.1327. The lines include the Simple Moving Average 5-4h, the Fibonacci 38.2% one-day, the Bollinger Band 1h-Middle, the previous 4h-low, and the BB 15min-Lower. The next support is even stronger. 1.1280 is the convergence of the powerful SMA 100-1d, the Fibonacci 38.2% one-week, and the Fibonacci 161.8% one-day. On the other hand, resistance is weaker. The line to watch is 1.1368 which is the confluence of the Fibonacci 161.8% one-month and the 200-day SMA. Further above, weaker resistance awaits at 1.1415 where we find the Pivot Point one-month R3 waiting for EUR/USD,” as cited by FXStreet’s Senior Analyst Yohan Elam.
About Draghi’s speech
As part of his job in the Governing Council, he gives press conferences in the back of how the ECB observes the current European economy. President's comments may determine positive or negative the Euro's trend in the short-term. Usually, if he shows a hawkish outlook, that is seen as positive (or bullish) for the EUR, while a dovish is seen as negative (or bearish).
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