EUR/USD Spot Price: 1.1310
Support - 1.1250, 1.1215, 1.1200
Resistance - 1.1300, 1.1345, 1.1350
Trade-Ideas - The EUR/USD is Up
I want to get short at 1.1325 with a stop loss at 1.1375 and a profit target of 1.1250.
EUR/USD 240 min Chart - EUR/USD is Weak
At the beginning of February, the EUR/USD was trading as high as 1.1500 and looking decidedly bullish. Since that point, it has drifted from key resistance and is now testing support which is around two-year lows.
One of the main reasons is that the state of the Eurozone continues to be weak. Later last week, an ECB official came out and suggested they could be looking to offer more long term loans to key European banks, to help them as the state of the economy continues to struggle.
That is a bearish sign for the EUR/USD and we have seen that weakness weighs on investor confidence recently.
This week the ECB minutes will be released and that could shed more light on what President Mario Draghi is currently thinking. He has been incredibly dovish for years, so it should come as no surprise that the ECB is considering fresh loans to banks. The last time we saw that sort of thing was at the hight of the European debt crisis back in 2012.
Outside of the ECB minutes, the real key data point this week will be Eurozone CPI. CPI is currently sitting at 1.4% YoY and we have to remember that the ECB is targeting a band of somewhere between 2 and 3%. So we are a long way away from that point.
With that in mind, it is clear that Mario Draghi’s dovish stance on rate is likely to continue for the near future.
The EUR/USD has been trading between 1.1300 and 1.1500 for many months now and this week finally dipped back below the 1.1300 key support.
If price is able to hold below support at 1.1300, then that is incredibly bearish and will open up the door to further falls.
EUR/USD - Key Levels
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