ECB’s Lagarde said that:
- We monitor the exchange rate
- It is obvious that exchange rates may have an impact on inflation
The truisms are not anything new, but given more illiquid afternoon markets, it did give a minor boost to the beaten down EURUSD.
The move to the upside took the price into an briefly above a swing area between 1.0655 and 1.0675. The high price today has reached 1.0679. The current price trades at 1.0670.
Technically if the price were to move above the 1.0675 level and stay above, the story comes against the Lowes from February at 1.0694 followed by the broken 61.8% at 1.07133. There is a swing area between 1.0722 and 1.07314 which would be another key target on increased buying.
With the ECB looking to cut rate in June, and the Fed looking to put off cutting rates to later in the year, it does give the nod to selling the EURUSD pair. However, you never know when a central bank comment may give seller some cause for pause. The technicals will help tell the story as it is developed from the news headlines.
The video above explains it all.
This article was written by Greg Michalowski at www.forexlive.com. Source