EUR/USD – above 1.10, attempting break above hourly 50-MA

EUR/USD consolidated above 1.10 in early Asia and is not attempting a break above hourly 50-MA of 1.1024 levels even though investors expect ECB to tweak its monetary policy today.

Eyes ECB rate decision

Euro traders would watch out tweaks in the monetary policy like – extension in the maturity of the QE program and/or drop in the threshold for bonds. Draghi’s comments on post Brexit vote world and the situation in the Italian banking sector could influence Euro as well.

Markets do not expect a rate cut today, nevertheless Draghi is likely to reiterate readiness to do more if required. In the wake of dovish expectations, the recovery above 1.10 in EUR/USD warrants caution. Apart from ECB decision, the pair could also find taker/sellers depending on the quality of weekly US jobs data.

EUR/USD Technical Levels

Acceptance above hourly 50-MA of 1.1024 could yield 1.1050 (hourly 100-MA). A violation there would open up upside towards 1.11 handle. On the other hand, a break below 1.10 (zero figure) would signal a fresh drop to 1.0971 (June 27 low), under which the Brexit day low of 1.0911 stands exposed.