EUR/USD: The Euro continues to advance, but beware of the ECB this afternoon


© O Financista. EUR/USD is progressing, in expectation of the ECB

Investing.com – The EUR/USD pair continued its progress on Thursday, after having already risen sharply in the past two days.

Recall that the Euro-Dollar benefited yesterday, among others, to the rise of the Pound, which has posted a rally of over 200 pips against the backdrop of reports that Theresa May would have the greatest chances to successfully pass the motion of censure proposed by part of the opposition.

Italy proposes a target of budget deficit, which is expected to satisfy the EU

This morning, additional advancement of the EUR/USD, which has given rise to a new peak at 1.1393, is to be linked to the negotiations between Italy and the EU about the budget.

The Italian Prime minister, Conte has indeed proposed a target of budget deficit in 2019 by 2.04% to the EU, which is likely to be sufficient to avoid the sanctions provided for in the framework of the excessive deficit procedure launched by the EU against Italy.

Italian bonds also welcomes the improved situation, with a rate at 10 years, which has marked a low of 2.920% this morning, its lowest level since the end of September 2018.

Focus on the ECB meeting this Thursday

Today, the market should focus on the ECB meeting, with the announcement of the rates to 13.45 pm, and the press conference of Mario Draghi from 14: 30.

The ECB should in all likelihood confirm the end of QE, but many analysts believe that in view of the recent deterioration in the economic climate, the ECB may show a turning dovish in his comments, which would weigh heavily on the single currency.

Technical analysis EUR/USD

From a graphical point of view, it will be recalled that the day yesterday was the occasion of several bullish signals : a Break above the line of the downward trend visible since Monday, breaking above the moving average 200 hours, and a break above the moving average 100 hours.

However, significant obstacles close to the current price must urge caution, with mostly the psychological threshold of 1.14, which has blocked the net attempting to increase on Monday, and had sent the Euro to a fall of nearly 100 pips in a few hours.

Beyond 1.14, the other resistances to be taken into account are located at 1.1420-25, 1.1450, 1.1475 and 1.15.

Has the decline, the media to be monitored in priority may be identified at 1.1350, 1.1300-06, 1.1265, 1.1215 and 1.12.

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