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EURUSD is trading below strong psychological level of 1.2000

There are clear indications that the European Central Bank will soon embark on outright money-printing.

Consumer inflation has not been at the ECB’s target level of just below 2% since the start of 2013, and has been falling since a 3% peak late in 2011.

EURUSDH1

Traders have a number of eurozone concerns going into 2015, including the outcome of a snap election in Greece on 25 January.

The left-wing Syriza coalition is ahead in opinion polls and rejects EU austerity measures, which have been blamed for soaring unemployment and a rise in poverty in the country.

There are doubts about Greece’s future in the eurozone should it fail to stick with its agreed austerity programme.

Mr Draghi’s remarks are yet another signal that full-scale quantitative easing in the eurozone is probably coming. It could be less than three weeks away.

The ECB’s first major policy meeting of the year is on 22 January. Another clue to the ECB’s likely actions comes next week, when we get a first estimate for eurozone inflation in December.

The previous month’s figure was 0.3%. Anything lower would reinforce the odds of early action by the ECB.

And there are plenty of reasons to think inflation might be lower.

There is the continued decline in global oil prices, and new business survey data suggesting the eurozone is still weak.

There is no single indication of Eur going upwards.

The trade setup I worked out can be seens in chart.
Sell EURUSD @ 1.1945
Stop @ 1.2010
Target @ 1.1780

Bears are winning over bulls in EUR and the dollar is going very good in upward diection.

Guest post by [Ali Syed Arsalan]