On Monday morning, the major currency pair is barely moving. A lot of investors have been rather inactive since last Friday due to the Easter holidays, that’s why today’s economic calendar is almost empty.
When the market is calm and there is no news, it’s high time to learn different opinions and predictions for the future. For example, the CBA (Commonwealth Bank of Australia) attracted attention by saying that it might make sense to buy the euro against the USD with the target at 1.16. The argument is that effective economic policies and measures taken by the Eurozone will provide the financial stability of the region.
Indeed, last week, finance ministers on the Eurozone agreed on a new tool to support the region, the ESM, which is an extended credit line for the alliance members. The countries that suffered most from the coronavirus pandemic and its consequences will get access to a huge amount of liquidity. The ESM will be an additional measure to already existing support mechanisms and the combined effect will help the Eurozone to recover rather quickly. Such a strategy really looks very promising, but it’s better to wait for the first results.
In the H4 chart, after returning to 1.0940, EUR/USD is consolidating at the top of this ascending wave. After breaking the rising channel’s downside border, the pair may form a new descending wave with the first target at 1.0888. Later, the market may start another growth to reach 1.0920 and then resume trading inside the downtrend. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving outside the histogram area but still above 0. If the line breaks 0 to the downside, the pair may boost its decline on the price chart.
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