EURUSD Drops to 11 Year Low Ahead of ECB, SPX Edges Towards Reversal
• The Euro droped across the board in the lead up to Thursday's ECB rate decision
• A Dollar rally pushed the Index to its five-week range and 11-year high, but its gains were uneven
• Pound and Canadian Dollar volatility forge unexpected moves amongst the crosses
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Despite heavy event risk directly ahead; we found surprisingly productive moves from the Euro, Dollar and equity markets this past session. The stand out on the day was the EURUSD which dropped to a fresh eleven and a half year low despite the fact that there is both an ECB rate decision and NFPs report due over the next 48 hours. While the long-term trend between European monetary policy and US employment are supportive of a bearish trend, the potential for a corrective action increases as well alongside volatility. Meanwhile, significant moves from the Canadian dollar (on the BoC decision) and British Pound (which stopped out my GBPUSD long) showed FX markets remain active. And, always looming in the background; the S&P 500 looks to be drawing closer to following its pattern of short-term rallies followed by reversal. We look closely at our markets and event risk in today's Trading Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.