On Thursday, trading on the euro closed down. During the European session, the single currency depreciated against the dollar, reaching 1.1371. This sharp drop on the euro was linked to comments from ECB governing council member and governor of Latvijas Banka, Ilmārs Rimšēvičs. He remarked that, due to low inflation in the region, the quantitative easing program could last another couple of years. It was later revealed that in August, ECB president Mario Draghi would be speaking at Jackson Hole, where it’s likely that some details will come to light about the ECB’s plans for reversing the QE program when they sit down in September. The euro then bounced from its session low of 1.1371 to 1.1419 and went into a sideways trend. Janet Yellen had nothing new to offer markets.
Day’s news (GMT+3):
EURUSD rate on the hourly. Source: TradingView
My predictions for yesterday came off in full. Today, my forecast looks North. After the triangle, we should be considering another downwards wave, with a renewal of yesterday’s 1.1371 low, but there are several reasons I’ve gone for a bullish scenario.
There are also some technical factors that point to a weakening of the euro, but they’re outweighed by the positives. In my forecast, I’m predicting growth to the 67th degree at 1.1451. We should keep an eye on whether buyers will be able to break through the LB and trend line at 1.1490.