Forex Signals Brief for June 6: ECB Interest Rate Decision Ahead
Rowan Crosby • 2 min read
Markets continue to be buoyed by the hopes that the FOMC and Jerome Powell are getting set to cut US interest rates.
One central banker who will not want rates in the US to fall will be ECB President Mario Draghi. As I wrote about earlier today, Draghi will today take the stage as the ECB release their official rate decision. While there is likely to be no change to official rates, Draghi might be sharing some details worth paying attention to.
The most obvious are the details of their new Targeted Long Term Refinancing Operation as well as any forward guidance and projections. Whatever happens, the EUR/USD will be in play later today and be worth following closely.
We will also get details on the state of Eurozone employment as well as GDP. Both might not move price all that much given the looming rate decision, but they will have a significant bearing on the ECB in the coming months.
Forex Signal Update
The FX Leaders Team finished with 1 win from 3 signals in a relatively quiet session.
NZD/USD – Active Signal
The NZD/USD has started to rally thanks predominantly to a weak USD. Price broke out above 0.6600 and has tagged 0.6650. We are long on this small pullback looking for some further upside and a break of the most recent highs.
USD/JPY – Active Signal
The USD/JPY is facing the same sort of headwinds as already mentioned thanks to a falling Greenback. Add to that some safe-haven inflows into the JPY, and we are clearly seeing some weakness in the USD/JPY. We are short here and looking for the trend to continue.
BTC has been relatively quiet over the last 24-hours and given its recent moves that is a bit of a change of pace. The $8,000 level is still holding as strong resistance and we will need to wait to see how price reacts on another attempt.
As I’ve been saying, I think we can be bullish above that level and if we see another failure, then the door is certainly open for some further downside in the short-term, with $7,000 an obvious target.
The other major coins ETH and XRP and also quiet today and waiting for a lead from Bitcoin.