Back
7 Feb 2013
Forex: EUR/USD accelerates the decline, around 1.3380/85
The euro has rapidly left behind two big figures so far, intensifying the downside through another key support at 1.3400, as bearishness intensifies on Draghi’s warnings that a high exchange rate could pose a threat to the inflation.
In the view of analyst Carsten Brzeski at ING, “Adding the stronger euro to the downside risks for price stability opened the door for new policy action if the euro strengthens further and starts to weigh on the growth and inflation projections. Moreover, Draghi did not get tired of stressing the ECB’s accommodative monetary stance. He even implicitly voiced his dissent with monetary policies too obviously aimed at weakening the currency, sending an implicit signal that the ECB would not be happy with a further, not fundamentally-driven, appreciation of the euro.”
At the moment, EUR/USD is losing 0.99% at 1.3388 facing the immediate support at 1.3349 (low Jan.25) ahead of 1.3265 (low Jan.23) en route to the psychological level at 1.3200
On the flip side, a break above 1.3523 (MA10d) would aim for 1.3598 (high Feb.5) and then 1.3659 (Upper Bollinger).
In the view of analyst Carsten Brzeski at ING, “Adding the stronger euro to the downside risks for price stability opened the door for new policy action if the euro strengthens further and starts to weigh on the growth and inflation projections. Moreover, Draghi did not get tired of stressing the ECB’s accommodative monetary stance. He even implicitly voiced his dissent with monetary policies too obviously aimed at weakening the currency, sending an implicit signal that the ECB would not be happy with a further, not fundamentally-driven, appreciation of the euro.”
At the moment, EUR/USD is losing 0.99% at 1.3388 facing the immediate support at 1.3349 (low Jan.25) ahead of 1.3265 (low Jan.23) en route to the psychological level at 1.3200
On the flip side, a break above 1.3523 (MA10d) would aim for 1.3598 (high Feb.5) and then 1.3659 (Upper Bollinger).