Euro Breaking News: European Commission Spring Forecast Buoys EUR/USD
The European Commission’s Spring Forecast for 2022 revised Eurozone inflation upward to 6.1% in 2022 as expected with forecasts expected to decline to 2.7% in 2023. Growth projections in the region were subsequently lowered to 2.3% from 2.7% in February.
Initial reaction from the Euro was positive with higher inflation potentially leading to a more aggressive ECB. Money markets are looking more hawkish than last week Friday with roughly 94bps priced in for 2022 as opposed to 80-85bps on Friday. The ECB’s Villeroy added support for the Euro stating that the June meet will be “decisive” while moving towards a “neutral rate”.
Initial reaction from the Euro was positive with higher inflation potentially leading to a more aggressive ECB. Money markets are looking more hawkish than last week Friday with roughly 94bps priced in for 2022 as opposed to 80-85bps on Friday. The ECB’s Villeroy added support for the Euro stating that the June meet will be “decisive” while moving towards a “neutral rate”.
TECHNICAL ANALYSIS
Resistance levels: 1.0600 20-day EMA (purple)
Support levels:
1.0400 1.0340 – 2017 swing low
1.0064 (76.4% Fibonacci)
Support levels:
1.0400 1.0340 – 2017 swing low
1.0064 (76.4% Fibonacci)
IG CLIENT SENTIMENT DATA: CAUTIOUS
IGCS shows retail traders are currently LONG on EUR/USD, with 76% of traders currently holding long positions (as of this writing). At DailyFX we typically take a contrarian view to crowd sentiment however, recent changes in long and short positioning result in a mixed bias.
IGCS shows retail traders are currently LONG on EUR/USD, with 76% of traders currently holding long positions (as of this writing). At DailyFX we typically take a contrarian view to crowd sentiment however, recent changes in long and short positioning result in a mixed bias.
(Reporting by AJFX Limited, Editing by Shivangi Jadav)
