The Euro (EUR) inched lower against the US Dollar (USD) on Friday, decreasing the price of EURUSD to less than 1.1600 following some key economic releases. The technical bias remains bearish because of a lower low in the recent downside move.
EUR/USD Technical Analysis
As of this writing, the pair is being traded around 1.1557. On the downside, a support can be noted near 1.1510, a key horizontal support ahead of 1.1409, the low of last major downside move and then 1.1349, the 50% fib level as demonstrated in the given above chart. The technical bias may turn bullish if the pair breaks the 1.2478 resistance level.
On the upside, a resistance can be noted around 1.1753, the 23.6% fib level ahead of 1.2456, a trendline resistance and then 1.2555, a major horizontal resistance area as demonstrated in the given above chart.
ECB Hints at Ending QE
A staggered exit from quantitative easing is the most Mario Draghi can do. The European Central Bank said on Thursday it expected to stop adding to its bond portfolio via purchases of sovereign and corporate debt. But the exit is qualified by caveats, and a pledge to keep rates low. Trade wars and a weak euro zone mean the ECB president has little choice but to keep his options open.
The ECB’s statement that it expects to stop increasing the size of its bond portfolio at the end of December marks the official end of the money printing experiment begun in 2015. It looks about time: growth is healthy, and the central bank expects inflation to average 1.7 percent over the next two years, close to its target. Employment in the euro area is at a record high.
Trade Idea
Considering the overall price behavior of the pair over last few weeks, buying the EURUSD around current levels can proved to be a good decision in short to medium term.