EURUSD sells off amid confusing ECB press conference
.png)
The ECB hiked rates by 50bps today, maintaining that another 50bps is coming in March. However, the press conference delivered by president Lagarde proved to be confusing. Besides, obscure phrases like "continuity in a steady state", she pointed to data dependency and a "meeting by meeting" approach. This suggests the 50bps in March is not a done deal. The market interpreted the press conference as dovish and the EURUSD sold off.
The EURUSD hourly trend-following EMAs and momentum-based stochastic crossed down (black ellipses). The stochastic now finds itself below 20 (blue arrow). This level will put EURUSD under further pressure if maintained. From our perspective, core inflation is not sufficiently under control and looking through the fog of today's press conference, the ECB is likely to stay the course.
Russell Shor
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.