Good day forex traders and readers.
Welcome to our popular EUR/USD forecast. It has been great for our readers for sometime now as many took the call and shorted the euro currency.
As we head into the European Central Bank press conference, caution is advised.
Looking at the EUR/USD daily chart above we note that the currency pair is challenged by a strong support region of 1.1550. While the EUR/USD did dip below this level, the pull back was significant.
Any bearish momentum is likely to target 1.14. Should a bullish correction happen, 1.18 will be a possible target.
The fundamental situation is simple for now. The prevailing sentiment is that the European Central Bank is announcing the start of quantitative easing on Thursday. If this indeed happens, it is widely believed that the euro currency value may erode. As a matter of fact the anticipation of this has already depressed the EUR/USD.
Readers will need to be cautious as any unexpected development may result in forex spikes. It may also be possible that the QE policy is already priced in and hence no significant movement may result.
I will be adopting a wait and see stance for now.
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