The EURUSD pair rose sharply after the latest interest rate decision by the European Central Bank. The pair initially moved sideways and then rose during the speech of Christine Lagarde. In its statement, the country’s central bank said that it will leave interest rates unchanged until inflation moves comfortably above 2%. However, in her press conference, Lagarde refused to rule out an interest rate hike this year. Analysts believe that the rate hike will happen in the third or fourth quarter. The 10-year German bund rose to the highest level in almost three years.
The US dollar index declined against most currencies in the overnight session. It declined mostly because of the strong performance of the euro and British pound after the ECB and BOE decisions. The currency also retreated because of relatively weak initial jobless claims numbers. Later today, it will react to the latest US initial jobless claims numbers. Analysts expect the data to show that the country’s unemployment rate remained unchanged at 3.9% in January. They also expect that the economy created over 150k jobs in January. On Wednesday, data by ADP revealed that the country’s private sector lost more than 300k jobs.
American stocks declined sharply as investors continued to dump technology stocks. One of the worst-performing stocks was Facebook, whose shares declined by 25%. The decline was because of the company’s weak earnings and challenging environment. As a result, other social media-focused companies like Snap, Pinterest, and Twitter also declined. Most growth stocks have crashed by more than 30% from their all-time high.
EURUSD
The EURUSD pair continued its bullish momentum after the hawkish statement by Christine Lagarde. It jumped to a multi-high week high of 1.1435, which was substantially higher than last month’s low of 1.1120. On the four-hour chart, the pair has moved above the 25-day moving average and the Ichimoku cloud. It is also fast-approaching its highest level in January. Therefore, there is a likelihood that the pair will continue rising ahead of the NFP data.
GBPUSD
The GBPUSD pair has been in a strong bullish trend lately. The pair jumped to a high of 1.3615, which was the highest level since January. On the four-hour chart, the pair is approaching the median line of the Andrews Pitchfork tool. It has also moved to the 23.6% Fibonacci retracement level. It also moved above the 25-day moving average. The path of the least resistance for the pair is to the upside.
EURCAD
The EURCAD pair also jumped sharply after the ECB decision and ahead of the latest Canadian jobs numbers. It rose to a high of 1.4500, which was the highest level since December 30. On the four-hour chart, the pair moved above the 61.8% Fibonacci retracement level. It is also along the upper side of the Bollinger Bands. Therefore, the pair will likely keep rising although a pullback is also possible ahead of the Canada jobs numbers.
