Since the opening of the trading day the pair EUR/USD is traded in the narrow channel near the level of 1.1300. Traders’ activity is very low in anticipation of ECB’s interest rate decision and following up press-conference.
However, volatility in the market and in the pair will sharply grow after 13:45 (GMT+2) and 14:45 when press-conference starts.
Market’s reaction to the comments by Mr. Draghi is difficult to predict.
In case of breakout of support level of 1.1285 (Fibonacci 23.6% to the last wave of decline from the highs of 2014) and 1.1265 (ЕМА200 on 4-hour chart) the pair will continue to decline to 1.1165 (ЕМА200) and 1.1120 (ЕМА144 on the daily chart).
As an alternative scenario the pair may grow above recent highs at the level of 1.1380 up to the upper limit of the ascending channel on the daily chart at the level of 1.1460.
Further movement direction in the pair will depend on Draghi’s comments, general situation in the currency market, movement in the USD, oil prices and investors’ appetite to risk.
If the price goes above the level of 1.1460 the pair EUR/USD may reach the level of 1.1700, or 1.1785 (Fibonacci 38.2%) and 1.1900 (ЕМА144 on the daily chart).
Support levels: 1.1285, 1.1260, 1.1165, 1.1120 and 1.1100.
Resistance levels: 1.1380 and 1.1460.
Sell Stop: 1.1260. Stop-Loss: 1.1310. Targets: 1.1165, 1.1120, 1.1100 and 1.1050.
Buy Stop: 1.1320. Stop-Loss: 1.1280. Targets: 1.1460, 1.1500, 1.1600 and 1.1700.