The Euro bulls found support at the 1.1760 level yesterday as they currently attempt to recover back above the 200-period MA and the 5-month trend line, ahead of the ECB rate decision. The central bank is widely expected to keep policy tools unchanged. As such, the focus will be on the ECB’s take on the pace of the economic recovery, negative inflation, economic forecasts, and the deflationary impact of the euro’s 6% quarter-to-date rise against the US dollar. Given the Eurozone inflation has turned negative for the first time since 2016, markets believe President Lagarde will likely talk down the single currency. However, any disappointment will likely push the Euro back towards 1.19 and possibly higher.
Support: 1.1760 / 1.17
Resistance: 1.1860 / 1.19
