The Euro maintains positive tone in early Thursday’s trading and probes again through cracked Fibo barrier at 1.1132 (76.4% of 1.1179/1.0981) after Wednesday’s post-Fed advance spiked to 1.1144 but failed to close above.
German inflation data came in line with expectations in November, making no impact to Euro’s performance.
Dovish stance from Fed on Wednesday, as the central bank stayed pat but signaled the policy would likely remain unchanged through 2020, deflated dollar pushed the single currency to new five-week high on 0.3% advance on Wednesday.
Traders turn focus towards ECB policy meeting today, as it will be the first policy meeting under command of new ECB president, Christine Lagarde.
Although the central bank is not expected to take any action today, Lagarde’s press conference will be closely watched, as markets await to hear her opinion and economic forecasts.
Lagarde is not expected to significantly change dovish policies of her predecessor Mario Draghi and keep the hawks under control that would be supportive for Euro.
Technical outlook remains positive as bullish momentum is strengthening and thick daily cloud continues to underpin the action.
Bulls look for positive signal on close above 1.1132 Fibo barrier to attack 200DMA (1.1153) and extend gains towards key short-term barriers at 1.1175/79 (4 Nov / 21 Oct highs).
Former highs at 1.1115/09 and broken Fibo 61.8% at 1.1103 mark solid supports which are expected to hold dips and guard more significant daily cloud top (1.1082), violation of which would sideline bulls.
Res: 1.1144; 1.1153; 1.1179; 1.1200
Sup: 1.1115; 1.1103; 1.1082; 1.1074