The Euro maintains bullish tone above 30SMA (1.1560) and holding in green for the fourth straight day, but upside remains capped by thin daily cloud. Risk of another upside failure exists as 14-d momentum on daily chart is weakening and about to penetrate negative territory and daily cloud turns lower on Friday.
Bullish scenario requires close above initial barriers at 1.1650 zone to signal continuation expose falling 100SMA (1.1680) and key barriers at 1.1733/50. Cluster of converging daily MA’s (10/20/55) at 1.1606/14 zone marks solid support, guarding pivotal 30SMA, loss of which would expose key Fibo support at 1.1517 (50% of 1.1300/1.1733 rally).
ECB meeting today is the key event for Euro. Although, no changes in the policy are expected, markets will be looking for signals about start of reducing central bank’s massive monetary stimulus.
The Euro could come under pressure on dovish tone from ECB’s post-meeting message and could risk violation of 1.1517, with clear break here to bring bears fully in play for further retracement of 1.1300/1.1733 rally.
Res: 1.1650, 1.1680, 1.1718, 1.1733
Sup: 1.1614, 1.1606, 1.1560, 1.1526
