Two weeks ago, the ECB went all guns ablazin’ as it cut the interest and deposit rates and increased the stimulus plan by an additional 20 billion Euros a week. The Euro tumbled for a while but then reversed and surged for 400 pips against the US Dollar, and this translated into a broad USD selling. I guess the market saw the measures as a positive sign for the Eurozone economy after all. Last week, we had the FED on center stage. On their February meeting, when the global financial markets were in trouble, the FED was sort of neutral, so the market expected them to be neutral to hawkish now that the worst was over. But suddenly they turned dovish, and this hurt the USD again, sending it 300 pips lower against most majors.

The Brussels attacks are giving the Buck a helping hand

EUR/USD reached 1.1342 and USD/JPY fell below our February lows to 1.1067. That was on Thursday, as the second wave of USD selling unfolded. We opened a long-term EUR/USD sell forex signal at 1.1180, which was a bit too early since the price moved higher. It still looks and feels alright, however, and we think that it will make us a couple of hundred pips. But why are we taking this position? Well, the Euro has started to retreat against the USD, same as most other majors. The Belgian terror attacks have certainly played a role this morning. So, has the FED effect already been brushed off? We´ll see in the coming days… but it certainly looks so right now.