Eur/usd - page 215
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EUR/USD continued to fall on Friday to negotiate below 1.15.
When it reached the level of 1.1467 (S1) sounded the bull alarms and recovered.
The trend continues in a clear downward movement and below 1.1467 (S1) we can see the EURUSD hit the barrier of 1.1368 (S2), defined minimum of 7 November 2003.
R3 - 1.18458
R2 - 1.17471
R1 - 1.16567
Daily Std. Pivot - 1.15580
S1 - 1.14676
S2 - 1.12785
S3 - 1.12785
price is making small correction but I don't think it will continue. even with last week's hammer I have no faith in the euro
EUR/USD Rapid Slide Could Continue Until Parity – RBS
An announcement on Quantitative Easing by the European Central Bank is imminent. But is it already priced into EUR/USD?
Greg Gibbs at RBS discusses an option of a rapid slide in the pair, that could send it all the way to parity:
Here is their view :
“The upside risk for EUR on market disappointment over the size of ECB QE on Thursday is relatively low…
On the other hand, the risk is high that the EUR falls significantly if the ECB delivers a sizeable or open-ended QE program.
The market is still coming to terms with the downside potential for EUR; it is still far from being very historically cheap in a long term sense, there is limited historical technical support until the lows below parity set in the early-2000s, and it is not clear who is going to step into buy it at any near-by levels if the ECB attempts to over-whelm market expectations.
In coming months, after the probable introduction of QE, EUR rates will probably drift towards their -0.20% floor at the same time as a EUR downtrend persists. As such, it is not hard to imagine EUR’s recent rapid slide continuing as a trend until parity is reached.”
source
EURUSD rose on yesterday session but with a narrow range creating an inside day. The pair is trying to build up enough of a bullish momentum to head back to the 1.18 level. Be aware, this week is “do or die” for EURUSD due to the ECB monetary policy statement on Thursday and the Greek elections on Sunday.
Investor Optimism Soars in January: German ZEW
Even though dark clouds are gathering over the euro zone, the closely watched onward-looking ZEW survey from Germany showed that optimism among the nation's analysts has continued to reign in January.
The ZEW index, measuring investor sentiment for the next six months and reflecting the difference between the share of optimists and pessimists, rose to 48.4 in January from the 34.9 booked for December, rebounding further from the lows seen in October.
Current situation
The ZEW Current Situation Index, meanwhile, also improved to 22.4 after 10.0 a month ago, suggesting that investors in Germany are becoming more and more optimistic about the nation's economy.
Analysts had forecast the figure to rise to 13.0 during the reported month.
ECB action awaited
Even though the mood among German investors remains positive, the recently released number should not exert any considerable influence on the plans of European Central Bank (ECB) officials, who hold their monetary policy meeting on Thursday and are widely expected to announce full-blown QE.
Rather than real macro data, it's the falling euro and oil prices that represent a flicker of hope for the euro zone's powerhouse and the region as a whole.
Germany's central bank recently said lower oil prices will have a positive impact on growth in the country, perhaps pushing the rate above its latest forecast. However, it also warned the slump will be reflected in a slow-down in German inflation that may temporarily fall into negative territory.
source
I don't think anything will happen much until thursday.
EURUSD fell during the course of yesterday session, but did not move very far from Mondays low at 1.1551. The pair is in a sideways action waiting for the “do or die” events the 1st one tomorrow with the ECB monetary policy and the other one on Sunday the Greek elections. So be aware of explosive volatility in the next few days.
Don't Get 'Overexcited' About Thursday's Meeting: ECB Nowotny
The European Central Bank's policy meeting on Thursday will be interesting but we "shouldn't get over excited about it", ECB Governing Council member Ewald Nowotny said on Wednesday.
Speaking at a Euromoney conference in the Austrian capital on Wednesday morning, European Central Bank (ECB) Governing Council member and Austrian central bank chief Ewald Nowotny (pictured in front) said that the much anticipated ECB monetary policy meeting on Thursday will be an interesting one but we "shouldn't get over excited about it."
The euro zone central bank's deliberations will be closely watched amid strong expectations that bank President Mario Draghi will announce a full-scale bond-purchasing program.
However, many questions about the ECB measures remain open and the chances for market disappointment are high, analysts warn.
Nowotny also told the conference audience that inflation rates were low but he did not expect deflation. Nonetheless, inflation developments need to be monitored closely, he added.
ECB QE Could Hurt Banks, Says Deutsche Bank Co-CEO
The European Central Bank's stimulus program, expected to be launched on Thursday, will have a "profound effect" on banks and could destroy their margins, the co-chief of Deutsche Bank said in Davos.
Anshu Jain (pictured on the left), co-chief executive of Deutsche Bank, said during a panel appearance at the World Economic Forum in Davos on Wednesday that "quantitative easing (QE) will be of profound importance for Europe overall and particularly for banks operating in Europe."
"QE means stability for Europe and a better loan-loss provision environment, fewer bankruptcies and a stable landscape that ought to be good for banks," Jain told the audience, but "equally it means very low interest rates and a real destruction of net interest margins, which of course will be a huge challenge. So the best parts of our businesses, the deposit taking and the flow franchise businesses will all suffer."
The Deutsche Bank executive said that financial markets are expecting the ECB to launch QE of about €750 billion because €500 billion could be "slightly disappointing," while €1 trillion would be seen as "bullish."
Jain thinks that banks will have to adjust all aspects of their business model to the new environment that QE creates.
"We really need to adapt to this environment and frankly it's here to stay until European growth turns around, which could be while," he said.
source
ECB said to propose €50bn in QE per month through to the end of 2016 – Bloomberg
EUR/USD smashed down to 1.1568 from 1.1634
Bloomberg cite two ECB officials who have seen the docs
So that’s around just over €1tn over 21/22 months
We’re in rumour city here but that gives us a clue of the reaction if it’s confirmed tomorrow. At the moment we’re bouncing back from the drop and are back to 1.1615