The EUR/USD had a strong session, reversing some early weakness and closing higher on the day.

Of course, the main focus was the ECB and the Mario Draghi press conference. In recent times, the ECB and Draghi have really had to wind back their expectations for a rate hike in the coming months. It has now be pushed out until next year as we have heard.

With that in mind, there were rumours yesterday that the ECB might even push out the guidance even further but that didn’t happen.

During the press conference Draghi cautioned that the Eurozone had ‘ slower growth momentum’ with risks “tilted toward the downside” over the coming months.

That wasn’t enough for any major changes and now we need to ask the question as to whether the bearish news for the EUR/USD is now priced in.

Price fell away in the early action yesterday, but rebounded strongly. Since testing the 1.1200 level at the start of the month, price has continued to push higher.

Technically speaking we are making higher lows and higher highs with the next major level ahead is now 1.1300 and there might be a chance of a test this week. Given that there were likely plenty of shorts positioning themselves ahead of the ECB it might be fair to ask are there any more left to pile in?

Today the Euro session will be busy with a number of releases, albeit predominantly second tier CPI form Spain and Germany.

Now that the USD has ticked below 97.00 support, there might be an opportunity for both the EUR/USD and the other majors to catch some further upside.

Technical Levels

The 1.1300 level is the clear focus now. Should that break and hold, the bearish bets in the EUR/USD might be getting very nervous and we could really see some short covering and a spike to the upside.