MyFXspot.com Trade Ideas
- EUR/USD: sell at 1.1300, take profit at 1.1100, stop-loss 1.1400
Market Overview
The European Central Bank pushed out the timing of its first post-crisis rate hike until 2020. In addition, the ECB launched a third Targeted Long-Term Refinancing Operation consisting of two-year loans partly aimed at helping banks roll over 720 billion EUR in existing TLTRO and avoid a credit squeeze that could exacerbate the current economic slowdown. The ECB's move to extend the horizon for steady rates was likely to be perceived as a policy reversal for the central bank that only ended its bond-buying programme in December and has signalled an interest rate hike for later this year.
EUR/USD has plunged below the 1.1278 Fibonacci level, a 76.8% retrace of the 1.1234 to 1.1420 (February to March) up-leg, a daily close will confirm the shift in risk to the downside. That would increase the scope for a dive through the 1.1216 November 12 2018 low. We have placed an offer at 1.1300, upside should be capped by the falling tenkan line at 1.1333.
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