EUR/USD side-lined below 1.1200 ahead of ECB's Draghi
The EUR/USD pair once again found support near 1.1160 levels and made an attempt to regain 1.12 handle in the European, but in vain, as the bears continue to guard the 1.12 barrier, leaving the rate side-lined around 1.1180 levels.
EUR/USD: 1.1200 or 1.1160 on ECB Draghi’s speech?
The spot is struggling hard to take on the recovery above 1.12 handle, despite a broadly subdued US dollar and moderate risk-aversion, as the EUR traders await the speech by ECB President Draghi for fresh direction. Meanwhile, the USD index trades modestly flat around 97.30 levels, after having faced rejection just shy of 97.50.
Meanwhile, irrespective of Draghi’s comments today, the major is expected to remain underpinned going forward on the back of bullish technicals. The daily chart confirmed a ‘Golden Cross’ i.e. a bullish crossover between 50-DMA and 200-DMA on May 23rd.
Moreover, holiday-thinned markets may provide extra legs to the pullback in EURUSD from near 1.1160 region, while markets are widely expecting the ECB Chief to turn out dovish today.
ECB President Draghi us due to testify about the economy and monetary developments before the Economic and Monetary Affairs Committee, in Brussels. During his testimony, Draghi may reiterate that Eurozone growth and labor market are showing solid improvement, but remain vary on the inflation outlook.
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EUR/USD Technical Levels
Valeria Bednarik, Chief Analyst at FXStreet noted: “1.1160 is the immediate support ahead of 1.1120, with a stronger one at 1.1080. Seems unlikely the pair can break below this last. Above 1.1200, the risk will turn towards the upside, with scope then to advance up to the 1.1240/60 region.”