- Summary:
- EURUSD forms a bearish pattern as it broke a triangle acting as a reversal. At this point, the focus is on a move back to 1.20 should the ECB be dovish.
The EURUSD pair struggles to hold above the 1.21 ahead of the ECB interest rate decision and press conference in a couple of hours. The pair formed a possible triangle as a reversal pattern, broke lower yesterday, and retests it today.
At this point, the best way to make the most of the pattern is to simply go short at the market with a stop at the highs. However, the risk is that the ECB will sound too hawkish and that the EURUSD pair shrugs off technical and rises on fundamentals.
The ECB is expected to ease the monetary policy some more. So why is there a danger that the EURUSD will rise?
Besides the monetary policy, other factors contribute to the EURUSD volatility. Think of Brexit, which is still on the table, or the Recovery Fund and the European budget. Any progress on the three fronts should bode well for the EURUSD bulls.
EURUSD Technical Analysis
However, the technical picture looks bearish. The market made a new high at 1.2175 last Friday just before the NFP report and then was rejected.
Bears would want to sell at market and against dynamic resistance with a stop at 1.2175 and a target well below the 1.20 level. From a fundamental perspective, the focus should be on today’s press conference.
EURUSD Price Forecast
