Bank needed to maintain some powder dry at its December meeting in case more policy easing would be required later
The EURUSD has been hit in the last hour or so.
- First the price held resistance against a topside ceiling area at the 1.09438 level.
- Then the ECB meeting minutes were more dovish than expectations.
The combination (along with reminders of the "global risks" from the horrendous start to 2016) has seen the pair head back toward the closing level from yesterday's trade that came in at the 1.08759 level. The low on this move has bottomed at 1.0881, so far. A move back below the closing level and then the 100 hour moving average at the 1.08699 level (blue line in the chart below), should solicit more selling.
Keep an eye on the 1.0898-1.0902 area now on the correction. Looking at the hourly chart, the area has had a number of swing highs/lows near the level on the hourly chart (it goes back farther than what is shown in the chart). When this happens, the market tends to use the level to bounce off /or scoot through. If the price correction can hold against the area, the selling interest might be more serious. If it does not attract sellers, the day remains positive, the price remains above the 100 hour MA, the correction was quick and lower, it took steam out of the rally seen in the European session, but it is more bullish/positive.
