The EUR / USD pair is trading in different directions today, holding in the area of the intraday highs set yesterday.
The dollar index in Asia strengthened slightly in response to the approval by the US Congress of the stimulus program in the amount of 1.9 trillion dollars. Investors hope that massive fiscal stimulus measures will accelerate the economic recovery. According to economists surveyed by the Wall Street Journal, the growth of the US economy this year may reach 5.95%.
At the same time, the US inflation data released yesterday continues to have a negative impact on the dollar. The CPI declined in February, forcing many investors to reconsider their expectations of increased inflationary pressures in the US and earlier withdrawal of stimulating monetary policy by the Fed.
Today the central event of the afternoon will be the ECB meeting. The regulator is expected to leave the main parameters of monetary policy unchanged. The main focus will be on the comments of Christine Lagarde. First of all, investors expect signals from the regulator about a possible containment of further growth in government bond yields. Such statements can put pressure on the European currency. We are waiting for a fairly strong increase in volatility for the EUR / USD pair.
In the US today we are waiting for the publication of weekly statistics on applications for unemployment benefits.
On the chart, the currency pair continues to move towards the previously set target at 1.1950. At the same time, the medium-term trend remains downtrend, therefore, we are waiting for the formation of topping signals near the 1.1950 level.
The main scenario is corrective growth towards 1.1950 and a downward reversal.
An alternative scenario is a decline from current levels.
The current fundamental background is neutral. We consider shorts in the area of 1.1950.
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