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OMT may be legal says EU court aide – green light for QE

Did Draghi get the green light? While this is a non-binding decision, it seems positive for the ECB to move on.

The program is line with European Union law as long as certain conditions are met.  More details are set to emerge.

Update:  EUR/USD breaks below the double bottom on Draghi, OMT

The OMT is legal “in principle” but some conditions are needed.

The Outright Monetary Transactions program was introduced in 2012, at the peak of the debt crisis. It offered buying bonds of countries that would take up adjustment programs. This was primarily aimed at Spain and Italy. The mere decision was enough to calm markets and served as a bazooka: it was strong enough to never be used.

EUR/USD remains stable around 1.18 for now.

Just minutes before this decision, ECB president Mario Draghi sounded very determined to announce QE.

Here are the recent EUR/USD moves on the 30 minute chart:

EURUSD pressured after OMT pre ruling by the ECJ advocate January 14 2015

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.