Global macro overview for 22/02/2016:
The ECB Vice-President Vitor Constancio made remarks in the weekend that the inflation level that can not be reached despite the desperate measures from ECB. These comments could make the regulator deliver more stimulus in March. The decision has not been made yet, because Mr. Constancio still believes the EU is making slow progress towards recovery. Nevertheless, he admitted that it is quite possible that the European economy will soon see data showing negative inflation readings, given the recent shock of a peristent energy price fall. To conclude, we might sum up the facts about the current EU situation delivered by hard data: the economic figures. The EU's annual economy grew at 1.1% pace, less than in 2008 and it is still struggling with such problems as a slower growth rate, slump in bank shares as well as the refugee crisis. The EU responded by cutting the interest rate to -0.3%, but even that move did not help to reach the projected 2% inflation levels. So, next month the ECB deeper interest-rate cut might be almost certain.
Let's now take a look at technical picture of the EUR/USD pair. After breaking the golden trend line support, the pair is still trading above the important technical support at the level of 1.1059. Any violation of this level with a daily candle close below it will put bears back into control and even lower levels should be expected then.