EUR/USD Technical Analysis: Post-ECB Rally Stalls Near 1.12
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- EUR/USD Technical Strategy: Flat
- Euro stalls near 1.12 figure vs. US Dollar following post-ECB surge
- Looking for actionable short trade setup in line with long-term trend
The Euro has settled into digestion mode near the 1.12 figure against the US Dollar having soared to the highest level in a month last week. The move followed the ECB monetary policy announcement, where the central bank delivered an aggressive stimulus boost but hinted negative deposit rates had reached a floor.
Near-term support is at 1.1094, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis opening the door for a test of the 38.2% level at 1.0919. Alternatively, a push above the 14.6% Fib at 1.1202 paves the way for a challenge of the February 11 high at 1.1376.
Our 2016 fundamental outlook calls for continuation of the long-term EUR/USD down trend. However, current positioning does not offer an attractive trade setup and the available trading range is too narrow to justify initiating exposure from a risk/reward perspective. With that in mind, we will remain flat for now.
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