EUR/USD Forecast: ECB’s Villeroy Keeps Euro Muted, German CPI 5.1%
EUR/USD Forecast: ECB’s Villeroy, RECOMMENDED BY WARREN VENKETAS Get Your Free EUR Forecast Get My Guide A perceivably dovish ECB yesterday post rate announcement hushed Euro bulls after gains earlier this week. Monetary tightening guidance was quite vague in terms of a start date and the gradual path thereof did not bode well for EUR strength. US inflation data printed in line with expectations but recorded a 40-year high leaving the dollar room to run to the upside.
Earlier today we saw German inflation track estimates however comments by the ECB’s Villeroy muted any upside by reinforcing uncertainty within Europe, a cooling if inflationary pressures as well as a ‘wait and see’ approach regarding interest rate hikes.
EUR/USD Forecast: ECB’s Villeroy
EUR/USD bears have clawed back some lost gains this week; shortly after pulling the pair out of oversold territory shown on the RSI indicator. The course for EUR/USD firmly favors the downside both fundamentally and technically with geopolitical tensions remaining as a key influencing factor.
Resistance levels:
- 20-day EMA (purple)
- 1.1000
Support levels:
- Triangle support
- 1.0806
- 1.0636
IG CLIENT SENTIMENT DATA POINTS TO SHORT-TERM UNCERTAINTY
EUR/USD Forecast: ECB’s Villeroy, IGCS shows retail traders are currently LONG on EUR/USD; with 63% of traders currently holding long positions (as of this writing). At Daily FX we typically take a contrarian view to crowd sentiment however; recent changes in long and short positions have resulted in a mixed bias.
