Home EUR/USD: bulls lose sight of the 200-D SMA on ECB’s Coeure’s dovish tone
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EUR/USD: bulls lose sight of the 200-D SMA on ECB’s Coeure’s dovish tone

  • EUR/USD: ECB members contradicting one another, weighing on bull’s progress.
  • EUR/USD: traders eye the 200-D SMA, but wait for the US retail  sales.

EUR/USD has dropped back below the 1.20 handle as the dollar firms across the board with a slew of bearish headlines crossing the wires.  Currently, EUR/USD is trading at 1.1946, up 0.03% on the day, having posted a daily high at 1.1997 and low at 1.1939.

EUR/USD was supported in European trade by hawkish rhetoric from ECB’s Villeroy, sending the single unit up form the midpoint of the 1.19 handle towards the 1.20 handle, (falling a few pips shy). Villeroy, said that the end QE was near after which the ECB will give guidance on hikes – (The 200-D SMA is located at 1.2021 and traders were lacking anything concrete to start the week to fuel an appetite for taking on such a level).  

However, in recent trade, ECB’s Coeure spoke and contracting his colleague while currently making a speech on ‘The Future Of Central Bank Money’, and has said that the governing council sees rates at present levels for extended period of time, well past the horizon of net asset purchases, adding, “the excess cash the ECB created could backfire.” EUR/USD has dropped back to test the rising 50-hr SMA at 1.1945.   Next stop either way may need to wait until the US retail sales tomorrow.  

In other news:

In other European news, Italy’s league says will hold an informal referendum of members may 19-20 to approve eventual govt deal with 5-star.

Also, most major indices in Europe have closed in the red:

  • German DAX fell -0.15%
  • France’s CAC fell -0.02%
  • UK’s FTSE fell -0.18%
  • Spain’s Ibex felt -0.29%
  • Italy’s FTSE MIB rose 0.26%
  • Portugal’s PSI 20 rose +1.41%

EUR/USD levels

The daily technicals lean bullish after a recovery from the 1.1822 lows and after piercing the 10-D SMA. RSI is also turning positive and away from the oversold territories below 30. 1.2000 comes a psychological level ahead of 1.2020 (200-D SMA) and 1.2080. 1.2150 comes next, while 1.2415 and the March highs at 1.2447/76 are wider targets. On the flip side, the 1.1553 November low comes as a key target on a break of aforementioned lows and 1.1720.  

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