Following the latest Federal Open Market Committee (FOMC) Minutes and quantitative easing boost, undermined euro was stopped only by also speculation-driven dollar, related to rate-lifting timing bets.
As the European Central Bank’s (ECB) representative Benoit Coeure informed on Tuesday, summer slowdown on markets motivated the monetary authority to boost asset-purchases above the target, undermining the euro performance.
“The slightly higher purchase volume that market analysts may observe in the coming weeks is therefore unrelated to the recent episode of market volatility,” stated Coeure at a conference in London.
Nevertheless, US dollar remains subdued after FOMC Minutes, as officials formally accepted that June is too early term for a liftoff, so actual expectations moved to September or December. Market even counts on early 2016.
Following such development, we can expect the ECB’s QE to provide a long-term drag on the euro currency, while dollar, despite short-term drop, is expected to strengthen as the speculations set a more accurate timing.
We remain dollar-bullish with a long-term target at $1.0719 and $1.0491. As for short-term TPs for EUR/USD bears, $1.0966 and $1.0872 provide slight support levels, with a stronger one at above-mentioned $1.0719.
As for the euro bulls, we can expect in case of mostly negative US essential data for the pair to rise even to $1.1448 with further psychological level at $1.15 where stops are expected widely to be set.
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