How Did EUR React to the ECB Meeting? 

The European Central Bank (ECB) has raised interest rates by 25 basis points, marking its tenth consecutive rate hike since July 2022 and bringing the total increase to 450 basis points. The ECB is primarily concerned about high inflation levels, both current and projected, with concerns extending into the future. GDP growth projections for the eurozone have been revised downward for 2023, but the ECB views this as a temporary slowdown rather than a long-term issue. The rate hike represents a compromise to address both inflation worries and a weakening growth outlook. While future rate hikes are not completely ruled out, economic uncertainties make them unlikely, and the ECB will assess the impact of recent rate increases before considering further action.

EURUSD - D1 Timeframe

As seen from the chart, EURUSD on the daily timeframe dropped further into the pivot zone following the release of the ECB rates decision, creating the third consecutive low of a double divergence. Considering this, in conjunction with the bullish array of the moving averages and the presence of the pivot zone, it seems safe to expect a bullish price action going forward.

Analyst’s Expectations: 

Direction: Bullish

Target: 1.08401

Invalidation: 1.06039

EURNZD - D1 Timeframe

The attached chart reveals that EURNZD has been trading inside a rising channel for some time now, with its most recent move being a touch of the support trendline. Considering how the trendline and the 50-day moving average align perfectly on top of each other, I hope to see the bullish pressure resume in the market successively.

Analyst’s Expectations: 

Direction: Bullish

Target: 1.82887

Invalidation: 1.79437

EURCHF - D1 Timeframe

EURCHF, at the moment, is completing a retest of the demand zone yet again following the release of the ECB rates decision. This, for me, is often an indication of a reluctance of price to ‘move on’ from the demand zone, implying a likelihood of a breakout. In this case, however, I will follow the price action closely on the lower timeframe in search of clues as to the direction price intends to go.

Analyst’s Expectations: 

Direction: Bullish

Target: 0.96384

Invalidation: 0.94550

CONCLUSION

The trading of CFDs comes at a risk. Thus, to succeed, you have to manage risks properly. To avoid costly mistakes while you look to trade these opportunities, be sure to do your due diligence and manage your risk appropriately.

TRY TRADING NOW

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Author: Adetola-Freeman Ogunkunle

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