The greenback was sold-off on Thursday and the EURUSD pair ticked higher during the London session and was trading slightly above the 1.18 level.
The Fed raised rates yesterday, which was broadly expected, but the FOMC committee also expects two more rate hikes this year, up from one only. The committee improved economic projections as well. This was a hawkish sign and the greenback strengthened, however, the press conference sounded a bit dovish and the dollar gave up all gains.
Investors will pay close attention to today’s ECB monetary policy decision. The central bank is not expected to raise rates, but Draghi should announce steps to definite withdrawal of the QE program. This could be a hawkish sign and since the greenback failed to appreciate yesterday, today’s hawkish ECB could push the pair notably higher.
Technically speaking, should the EURUSD pair rise above the key resistance of 1.1830, further scope for appreciation might occur, with the next target at 1.19. The next major resistance and target for bulls is at the psychological level of 1.20, where the 200 day moving average is also seen.
Support is seen at 1.1735 and while the pair trades above, the short-term outlook seems bullish. Breaking below could cause another sell-off, targeting 1.1670. In all cases we strongly recommend to have rigorous money and risk management.
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