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European Central bank kept all the key interest rates unchanged as broadly expected. The asset purchase program will be concluded and so does the QE Era. The dovish statement pulls down the EURUSD pair to the lowest 1.1330, but all the loss is offset half. It is an unfruitful conference as estimated in spite of some trivial points to concern.
Except for the Italian made concession for the budget plan, EUR barely had any good news to appreciate. Peacefully, the ECB quarterly meeting brings no surprise to the market. Unchanged rate and end of QE indicated the winding up of the Draghi plan to boost the demand to get dynamic. The new proposal will be on the agenda next year. The ECB president reported that while risk s are still ‘ broadly balanced’. However, the risks to the growth outlook are moving to the downside owing to the persistence of uncertainties related to geopolitical factors, the threat of protectionism, vulnerabilities in emerging markets and financial market volatility. The forecast of the economic growth and inflation for the next year was lowered consequently. Combining with the closing Brexit deal, if no-deal Brexit occurred. The downside space will be thoroughly opened, and selling-off will be the tune for EUR.
Meanwhile, White House declared the postpone of the tariff against China till March. Beijing has pledged to cancel retaliatory tariffs on US cars, buy a significant amount of US soybeans, deal with intellectual property thieves and scale back its strategy to accelerate the development in high-tech sectors. The greenback will get a devaluation for the compromising.
Also, it is the end of another week, the December Preliminary Market PMI for the Euro area and some detailed figures for Germany and Spain will be out. The US will release November Retail Sales, up 0.4% on a monthly basis, and the Industrial Production for November, and Markit PMI. A positive reading will languish the EUR below 1.1300.
Technically speaking, The renewed price is now around 1.13581 and equates to the 50% retracement level of the 1.14981/1.12161 decline. Moving range of the pair is narrowing down in the symmetrical triangle, and the volatility is reducing. In the short-term, the outlook remained bearish for the pair but the space downward is limited. To the medium term, the pair is relatively neutral. The directionless technical readings add credence to the judgement. To verify the trend, the pair should breach the support at 1.13283 or the resistance at 1.13893 to indicate a clear path.

ECB set the stage to end quantitative ease and maintain the current rate

Dec 01 2020