![Will Draghi Add Further Pressure On The EUR/USD? Will Draghi Add Further Pressure On The EUR/USD?](https://c.mql5.com/6/713/splash-660474.jpg)
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Dear Traders,
The euro experienced an almost linear decline last Friday, deviating from its recent highs at 1.1325 and 1.1355. The big question now is whether the EUR/USD is vulnerable to further losses with a shift from a bullish to bearish bias. In the face of various concerns in the euro-zone with regard to the refugee crisis, low inflation and the upcoming British vote on membership, we envisage a reversal of the downtrend in the euro. Investors will keep a close eye for any hints from ECB President Mario Draghi that the central bank will be initiating a fresh round of quantitative easing (QE) as soon as next month. Draghi will deliver his quarterly testimony to the Economic and Monetary Affairs Committee today at 14:00 GMT. If he signals further monetary easing in March, the euro could quickly slide towards 1.1080 and with a break of 1.1070/50 even lower towards 1.0970.
For the U.S. dollar, the main event risk will be the FOMC minutes, scheduled for release on Wednesday. Given a less hawkish Federal Reserve which is "closely monitoring global economic and financial developments" the dollar could perform with less momentum. U.S. Consumer Prices are due for release on Friday and if the report holds a positive surprise, the USD could regain its strength.
The most important data from the UK will be released on Tuesday with U.K. Consumer Prices and on Wednesday with the labor market report. While the British pound remained confined within a 200-pip trading range between 1.4580 and 1.4380, sterling traders should get ready for upcoming breakouts this week. A sustained break above 1.46 could drive sterling towards 1.4750 and 1.48, whereas a break below 1.4380 and further 1.4350 may send the currency to 1.4285. Below 1.4280 a next support is seen at 1.4240 and 1.42.
U.S. markets are today closed for President's Day holiday, markets could therefore be less volatile today.
EUR/USD
The focus will be on Draghi's speech and depending on any dovish hints, the risk could be to the downside for the currency pair. The euro may accelerate its decline after a break below 1.1160. A next target could then be at 1.1110 and 1.1085. A sustained break below 1.1070 could drive the common currency even lower towards 1.0975 and 1.0950.
Current resistances are seen at 1.1250, 1.1325 and 1.1355.
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