- FPG Securities (based on CNBC)
Despite ECB's decision to cut rates, the Euro skyrocketed 185 pips after Mario Draghi's statement yesterday, with the third resistance, the weekly R1, limiting the gains. The European single currency is now likely to undergo a correction, with supply at 126.50 acting as a catalyst. The closest support is located at 125.66, represented by the monthly PP, but the exchange rate could still remain above the 126.00 mark, as technical indicators shifted from bearish to mixed. In case the immediate resistance fails to hold the gains, the second target will then be the cluster circa 127.75, formed by 55-day SMA and the weekly R2.
Although not as strong as yesterday, but traders' sentiment remains bullish at 58% (previously 63%). Meanwhile, the portion of sell orders added four percentage points, rising up to a total of 60%.