Gtag:

Euro Depreciates Ahead of ECB’s Main Refinancing Rate Decision, Any Guidance on QE Program Likely to Bring Volatility in Euro Parity; Feb 03, 2022

ECB Interest Rate Decision

Today ECB has scheduled to release Policy Rate Decision at 1245 GMT/1815 IST. The rate decision is usually priced into the market, so it tends to be overshadowed by the ECB Press Conference, held 45 minutes later. The 6 members of the ECB Executive Board and 15 of the 19 governors of the Euro area central banks vote on where to set the rate, via rotation. Monetary Policy Statement is the primary tool the ECB uses to communicate with investors about monetary policy. It contains the outcome of their decision on interest rates and commentary about the economic conditions that influenced their decision. Most importantly, it discusses the economic outlook and offers clues on the outcome of future decisions.

Traders expect that the Central bank will keep its policy on hold for at least one more month but what will be the future course of action by ECB will remain in focus. Traders are looking for the further guidance on the Interest Rate hike, QE program, revised GDP, CPI and employment targets for the 2022.

Let’s see how Euro has reacted during the previous data release:

Dec 16:

Oct 28:

Technical View:

EUR/USD:

  • The Euro falls sharply ahead of ECB’s Interest Rate Decision and slips below $1.1300 mark.
  • The pair made intraday high at $1.1308 and low at $1.1277 mark.
  • Today triple EMA on a day chart is down and H1 chart suggests up trend for the time being.
  • A consistent close above $1.1325 on H1 chart requires for the upside rally.
  • Alternatively, a sustained close below $1.1272 on H1 chart will check further supports.
SUPPORTS RESISTANCES
$1.1272 $1.1330
$1.1250 $1.1354
$1.1215 $1.1376
$1.1180 $1.1397
$1.1156 $1.1426

Take a look and do trade wisely!
Good Luck

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