Never miss a story from Rich Dvorak

Subscribe to receive daily updates on publications
Please enter valid First Name
Please fill out this field.
Please enter valid Last Name
Please fill out this field.
Please enter valid email
Please fill out this field.
Please select a country

I’d like to receive information from DailyFX and IG about trading opportunities and their products and services via email.

Please fill out this field.

Your Forecast Is Headed to Your Inbox

But don't just read our analysis - put it to the rest. Your forecast comes with a free demo account from our provider, IG, so you can try out trading with zero risk.

Your demo is preloaded with £10,000 virtual funds, which you can use to trade over 10,000 live global markets.

We'll email you login details shortly.

Learn More about Your Demo

You are subscribed to Rich Dvorak

You can manage your subscriptions by following the link in the footer of each email you will receive

An error occurred submitting your form.
Please try again later.

EURUSD IMPLIED VOLATILITY – TALKING POINTS

  • EUR traders gear up for volatility ahead of the European Central Bank’s interest rate decision slated for 12:45 GMT tomorrow
  • Remarks from ECB President Mario Draghi will likely dictate the size and direction of price action
  • DailyFX provides a variety of trading resources found in our free Forex Education Center.For additional insight on currencies and the global markets, download the free DailyFX Top Trading Opportunities in 2019 Forecast

The overnight implied volatility on EURUSD forex option contracts exploded to its highest level since January 23 as currency markets prepare for potentially formidable price action. EURUSD traders are likely anticipating the European Central Bank’s rate review and follow-up commentary from President Mario Draghi to cause substantial price swings in the currency pair.

CURRENCY MARKET IMPLIED VOLATILITY AND TRADING RANGES

Currency market 1-day and 1-week implied volatility for EURUSD, GBPUSD, USDJPY, USDCAD, USDCHF, AUDUSD and NZDUSDForex Market Overnight and Weekly Implied Volatility

Although the ECB looks set to reiterate its zero-interest rate policy, the Eurozone’s head central banker may signal further willingness to support the bloc’s economy as downbeat data continues to disappoint. A tone that is interpreted as relatively dovish could put pressure on the Euro and send the currency to multi-week lows against the USD.

UPCOMING EURUSD DATA RELEASES AND EVENT RISK

Upcoming European Central Bank ECB interest rate decision and Eurozone economic data

Visit the DailyFX Economic Calendar for a full list of data releases and event risks that impactUSD, GBP, CAD, JPY, AUD, CNY, EUR, CHF, NZD and MXN currencies.

Markets will also eye final readings on Eurozone employment and GDP numbers. Fresh job data out of the US in addition to the country’s consumer credit report should is likely on the radar as well.

EURUSD CURRENCY PRICE CHART: 4-HOUR TIME FRAME (JANUARY 30, 2019 TO MARCH 06, 2019)

EURUSD Currency Price Chart Prior to ECB Interest Rate Meeting March 2019

EURUSD spot prices evidently coiled into a symmetrical triangle pattern between the currency pair’s February high and low. A breakout would suggest a continuation of the longer-term downtrend. EURUSD’s one-day trading range derived from overnight implied volatility implies that prices will likely remain between the 1.1376 and 1.1260 handles.

Additional Insight:

EURUSD Rate Forecast – Bearish Series Brings 2019 and 2018 Low on Radar

EURUSD Holds Support Ahead of ECB; USDCAD Rallies to Two-Month High

---

Written by Rich Dvorak, Junior Analyst for DailyFX

Follow on Twitter@RichDvorakFX