Today, on April 3rd, the common European currency is consolidating against the US Dollar while market participants are looking forward to the ECB’s interest rate decision.
Since the beginning of the European trading session, the currency pair is up by 0,01%, thereby moving in a narrow price range.
Meanwhile, European stock indices have been showing strength for the 7th consecutive day amid signs of economic improvement in the USA. Stoxx Europe 600 is up by 0,2%.
Most likely, the markets have been supported by the expectations that the ECB is likely to continue stimulating the economy in order to boost the recovery and reach the 2% inflation target. Some experts assume that the ECB is not going to change interest rates while being guided by the recent economic figures.
Still, if the ECB chooses to cut the benchmark interest rate and to announce further asset purchases, the common European currency may well decline against its American counterpart and some other majors, especially as the Fed is moving in the opposite direction in this case (the Fed keeps tapering its QE program).
Meanwhile, the experts working for Masterforex-V Academy, conducted comprehensive analysis to find out the near-term prospects and to define the most likely scenarios for EURUSD.
In particular, the H4 chart of EURSUD says that the mid-term bias is still bullish even though the situation may change after the ECB’s interest rate decision is announced.
Another wave of growth (the green arrow) started from 1,3477 on January 31st. The high of the wave is 1,3966. It was set on March 13th. The following price move is represented by a retracement from this rally. As a result, the price formed a local low at 1,3703 on March 28th, thereby forming a certain price range. Still, the top of the range is 1,3819. The range is highlighted by means of red horizontal lines.
The chart also shows us an MF sloping channel (another green line). Yesterday, the price broke through the line. This makes a further decline the most likely scenario. Still, everything will depend on the decision made by the ECB. If the decline continues (supported by negative news), the price may well reach 1,3703 and even 1,3642. This scenario is represented by the red downward arrow.
Alternatively, if the common currency manages to resume the rally (supported by positive news), the price is likely to break above the MF sloping channel to see further local highs, including. Still, in this case the price may encounter resistance at 1,3874 and 1,3966.
