EUR/USD (current price: 1.0614)
The ECB decided to lower the amount of its Quantitative Easing program to a monthly €60 billion yesterday. Investors expected a hawkish decision, but the Euro still declined sharply following the announcement. The pair hit 1.08 in early trading before collapsing back below the 1.06 level in the afternoon, finishing almost 1.5% down on the day. Mario Draghi’s words could mean that the ECB will continue its program for longer than traders expected before.
Our assessment: EUR/USD exited the prior short-term consolidation zone following the ECB statement. The long-term trading range is still intact as long as the 1.0475 support level holds.
