Forex Signals Brief for Feb 21: Markets Look to the ECB Minutes
Rowan Crosby • 2 min read
Regardless of the fact that the ECB’s Mario Draghi is a known dove, he really has little choice but to sit on his hands and wait.
I suspect today’s ECB minutes will suggest as much, as given the state of the Eurozone economy is ‘worrisome’, there aren’t many more levers that Draghi can pull. And a rate hike looks a long way off.
With the backdrop of a looming Brexit as well as Italy technically being in a recession, Germany still struggling and Spain off to an early election, there is still little to write home about. And given that inflation is still struggling at 1.4% YoY, there isn’t much more that needs to be said.
We will also get a look at some PMI readings from the Eurozone, which will also be a good indicator of just how things are looking. With the recent slide in the data being a good indication of the battles that the economy is still facing.
Forex Signal Update
The FX Leaders Team finished with three straight winnings trades in what was an excellent day.
EUR/USD – Active Signal
The EUR/USD is still holding below the 1.1350 level after a little jump and retrace yesterday. The EUR/USD is bearish for the time being but has been trapped in a range between 1.1300 and 1.1500 for a few months now.
EUR/CHF- Active Signal
The EUR/CHF is still around the same levels as the previous few days. With PMI and the ECB minutes, it might be make or break today.
Bitcoin looks to me like it might well be loading up for a test of the $4,000 level.
As mentioned yesterday, if price coils beneath a level, that is quite bullish price action. What I mean by coiling is that we start making higher lows in a tight triangle pattern, where price can’t drop.
That’s a sign of buyers holding up the price. Now that’s not to say that price will breakout as there could well be stronger selling pressure at $4,000, however, the price action is worth making note of.