Although initially markets were positively anticipating the upcoming Draghi speech at Trinity College, but the subsequent reaction led to quite rapid recovery of the Dollar on Friday.
To certain extent, such bearish movement could be related to anticipation of the German Parliamentary elections. However, as soon as it became clear that Merkel managed to retain her post, the Euro started restoring previously lost positions.
From technical perspective, this upside momentum is likely to be neutralized by a combined resistance formed by the 55-, 100- and 200-hour SMAs together with the weekly PP at 1.1947.
On the other hand, Draghi’s testimony at the European Parliament might create a new short-term volatility in the markets, which could give the pair a necessary impulse to bypass those barriers. In the opposite case, the rate is likely to fall to the bottom edge of a dominant ascending channel.
