ECB Officials Sound Cautious on Stimulus Exit
ECB governing council member Benoit Coeure said yesterday that policy makers are “very, very serious about the forward guidance”. Coeure referred to the communicates that ECB will keep buying assets “until December or later if necessary, that rates will remain low”. Coeure sees no reason to change the sequence. Another governing council member Francois Villeroy de Galhau said that the “current monetary policy stance remains fully appropriate based on current information.” ECB chief economist Peter Praet said that “risks are still tilted to the downside” in the medium term. Released from Eurozone, German PPI rose 0.0%, 3.1% yoy in March.
EUR/USD Daily Outlook
EUR/USD's rise from 1.0569 continues today and reaches as high as 1.0777 so far. Intraday bias remains on the upside for 1.0905 resistance and above. Nonetheless, choppy rise from 1.0339 is still seen as a correction. Hence, we'll pay attention to topping signal above 1.0905 again, as we'd expect larger down trend to resume later. On the downside, break of 1.0676 minor support will turn intraday bias back to the downside for 1.0569 instead.
In the bigger picture, as long as 1.1298 key resistance holds, whole down trend from 1.6039 (2008 high) is still expected to continue. Break of 1.0339 low will send EUR/USD through parity to 61.8% projection of 1.3993 to 1.0461 from 1.1298 at 0.9115. However, considering bullish convergence condition in weekly MACD, break of 1.1298 will indicate term reversal. This would also be supported by sustained trading above 55 week EMA.
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