EUR/USD
On the first day of the EU summit, as Poland and Hungary have agreed to accept the deal on the 750 billion euro fund against coronavirus as well as the 7-year EU budget worth1.07 trillion euro, the main distribution mechanism of which is "the principle of the rule of law and European values".
The ECB meeting was also calm. The volume of QE, or rather PEPP, was increased by 500 billion euros (worth 1.85 billion) and was extended until March 2022, and the requirements for receiving money under the TLTRO program was also eased. There was nothing new in Christine Lagarde's speech. In general, the "Black Thursday" we expected for the euro did not take place. We believe that the market still found the strength not to fall on the obvious easing of monetary policy for one reason - the expectation of a final and irrevocable resolution of the Brexit situation.
Now the euro has formed an expectation range of 1.2037-1.2175, while maintaining the possibility of short-term growth to 1.2230, which will lead to forming a divergence with the Marlin oscillator on the daily scale. The question is whether the price will be able to form this divergence before the final conclusion of the Brexit negotiations. We anticipate the euro's fall towards the 1.1934 level in the coming days - in order to support the MACD line on the daily.
The four-hour shows that the price is briskly growing upward; it is formally hindered only by the price level of 1.2175, overcoming it opens the way to 1.2230. And if it were not for the danger of Brexit, then our forecast would have been exactly the same, but now we recommend refraining from buying (especially on Friday) and waiting for the market to decline. The first target is 1.2037, the second is 1.1934.
The material has been provided by InstaForex Company - www.instaforex.com