EUR/USD continues to take on water after a shockingly weak Ifo survey caught the market by surprise. Hopes are that the slowing eurozone economy will drag down inflation and allow the ECB to cut rates in the next few months. The July ECB hike is looking more and more like a mistake, though the Bank will defend it as a needed warning to wage-setters not to hand out overly generous pay packages.
As for our month-old call for EUR/USD to fall to 1.4550, we’ll declare victory on that one. The double-top at 1.6035/45 worked to perfection and cements our belief that double-tops are among the more reliable technical patterns.
