The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
The FOMC statement due out at 7pm (London time) will surely now act as a catalyst for the future direction of EUR/USD.
It’s not a question of whether the FOMC should scale back its current QE programme or not, but rather but if it will happen. And, while hawkish speculation has increased in the past few weeks, the prospect of a change in monetary policy at this juncture seems quite unlikely.
Meanwhile, it’s all looking very rosy for the German economy. An upbeat ZEW number yesterday and an optimistic 20-year high for the IFO business climate today both serve to put an upside spin on Q1 growth expectations for the eurozone’s economic powerhouse.
The trend is most certainly and technically in favour of euro upside bias.
A push through the trendline resistance from the 11 December highs puts the pair on a course to retest the 1.3833 levels. Conversely, any declines below the 1.3730 level could see a return to 1.3620/30.