ECB's Makhluof is speaking and says:
- I do think we are there, or thereabouts, at top of the ladder on rates
- My view at the moment is that March 2024 is probably too early for 1st rate cut
- Not saying at our next meeting that we are going to hold, but we are near the top
- We will have a better sense of 2024 rate profile one we have the next set of projections in December
The EURUSD is moving to a new session high and is trading back above its 200-hour moving average 1.07019 (see chart below) despite the more dovish comments. Recall from last week, after the ECB raised rates by 25 basis points the price fell as market traders thought they ECB might be going too far. However, the last 3 of 4 days have seen a rotation higher. US rates are also moving lower with a 2 year now down 5.3 basis points. That is softening the dollar a bit.
Technically, earlier today, the price of the EURUSD moved above that 200-hour moving average only to stall shortly thereafter at 1.0704. The high price just reached 1.0708. The high price from yesterday peaked at 1.07175. That is the next upside target. Move above that level and it opens the door further to the upside (38.2% retracement of the move down from the end of August high comes in at 1.0751).
On the downside, moving back below the 200-hour moving average of 1.07019 would disappoint the buyers on the break back above the 200-hour moving average level. That would put the price back between the 100-hour moving average at 1.0673 and the 200-hour MA at 1.07019.