Euro Retraces Gains on ECB Speak; Resistance Looms at 200-day Moving Average

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The EUR/USD retreated back down to 1.0955, hitting a low of 1.0932 after surging to a high of 1.1042 on Wednesday. The currency pair had formed a bull flat and then refreshed with a surge as the exchange rate broke out.

The move came following ECB-speak as ECB member Liikanen said earlier that the central bank is ready to use more measures if needed, and his colleague Jazbec said that the ECB will do everything to fulfil its inflation mandate. Resistance on the currency pair is seen near Wednesday highs at 1.1042 which also coincides with the 200-day moving average. Support is seen near the 50-day moving average at 1.0955, and then again at the 10-day moving average at 1.0750.

Momentum on the currency pair is positive as the MACD (moving average convergence divergence) index prints in the black with an upward sloping trajectory that points to higher price on the exchange rate.

The 2-year yield differential between U.S. rates and German rates has rebounded from negative 138 to negative 123, a 15 basis point jump which has coincided with the change in the currency pair. If the yield differential does not retrace back down to its lows, it will be difficult for the current pair to make further headway below support levels.

The post Euro Retraces Gains on ECB Speak; Resistance Looms at 200-day Moving Average appeared first on FXTM Blog.

Source:: Euro Retraces Gains on ECB Speak; Resistance Looms at 200-day Moving Average

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