EUR/USD Breaks Out and Continues to Monthly Highs
On the Euro side:
- ECB has left inflation forecasts unchanged and lowered 2018/19 GDP estimates
- Draghi noted that uncertainty surrounding underlying inflation appears mitigated
- Euro now at fresh monthly highs
On the USD side:
- CPI rose 0.2% last month, below economists' expectations for a 0.3% increase
- Not expected to sway the Fed from hiking, but signs of a possible top
- A September hike is fully priced in, and USD continues to slide as expectations are managed
After EUR/USD returned to swing highs, we had a decision to make around whether to close longs here, or play for the breakout. Click the link to yesterday's blog, or read the extract below:
We've since seen price pull back to retest that support level that we were using to manage our risk around and then got a nice rip city move off of it, straight back to the highs.
From here, you should be sitting pretty depending on your risk:reward at the bottom there and now have the option to close at swing highs or hold for a play at the trend line breakout.
Well as you can see, Draghi ensured a EUR/USD breakout and we've now held above resistance quite nicely:
This one all unfolded pretty cleanly in the end.
Best of probabilities to you.
@danewilliams | Steemit Blog
Market Analysis
Twitter: @danewilliamsau