EURUSD Price Analysis: EU/US Pact, ECB Groundhog Day
EURUSD – Prices, News and Technical Analysis
- EU and US agree to work towards zero tariffs.
- ECB unchanged but press conference may fill in some of the blanks.
EURUSD Picks-up as ECB Meeting Nears
EURUSD currently trades around 1.17250, up around half-a-cent from Wednesday low, driven higher by positive news that the EU and the US would work together to bring non-auto industrial goods tariffs down to zero, reform the WTO while the EU would also buy more US soybeans and LNG. A positive start to negotiations but they still have to be ratified within the EU, while the EU automobile sector is still at risk, something that will continue to worry Germany.
EURUSD move remains muted after the positive news, capped by the latest ECB meeting at 12:45pm and followed by a press conference at 13:30pm. All monetary policy settings will be left unchanged, leaving the single currency at the whim of ECB President Draghi’s question and answer session. President Draghi is expected to be asked for further clarity on last month’s forward guidance that interest rates will remain unchanged ‘at least through the summer of 2019’ and his thoughts on future QE reinvestments. As the summer lull approaches, Draghi is unlikely to say anything contentious or market moving, setting the tone for a quiet month ahead for EURUSD traders.
DailyFX senior currency strategist Chris Vecchio will be covering the ECB Rate Decision Live from 12:30pm.
Looking at the daily EURUSD chart, a two-month trading range around 1.1500 – 1.1800 continues to hold with the current technical set-up looking mildly bullish. The pair trade above the 20- and 50-day moving average and recently broke back above the 38.2% Fibonacci retracement level at 1.1710. The RSI is mid-range and neutral.
EURUSD Daily Price Chart (November 2017 – July 26, 2018)
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--- Written by Nick Cawley, Analyst
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.