EUR/USD extends post-ECB slide, weakens to mid-1.1600s

   “¢   Draghi reaffirms to hold interest rates steady through the summer of 2019.
   “¢   Draghi’s upbeat inflation outlook does little to boost the shared currency.
   “¢   A pickup in the USD demand/US bond yields adds to the downward pressure.

The EUR/USD pair extended its intraday retracement from closer to weekly tops and weakened farther below the 1.1700 handle after the latest ECB monetary policy update.  

The pair started correcting from an important confluence region near the 1.1745-50 region and lost some more ground after the ECB President Mario Draghi reaffirmed the bank’s commitment to keep interest rates on hold through the summer of 2019.

During the post-meeting press conference, Draghi was also noted saying that uncertainty around the inflation outlook was receding and that underlying inflation was set to pick-up towards year-end. Draghi’s upbeat comments about  inflation outlook lifted Euro-zone government bond yields but did little to provide any boost to the shared currency.

Meanwhile, a goodish US Dollar rebound, supported by resurgent US Treasury bond yields and despite disappointing US macro data, exerted some additional downward pressure and dragged the pair back closer to weekly lows support near the 1.1660  region.  

Technical levels to watch

A follow-through selling has the potential to continue dragging the pair back towards the 1.1600 handle, below which the downfall could further get extended towards 1.1575 en-route the 1.1535 area and the key 1.1500 psychological mark.

On the flip side, any positive momentum now seems to confront resistance near the 1.1700 handle and is closely followed by the 1.1720-25 region and the 1.1745-50 important barrier, which if cleared would negate any near-term bearish bias.