Besides ECB we have US durable goods
My guess is ECB won’t have much to say today apart from wishing us great holidays. As per my GWTF comment this morning, data in Europe have not been supportive for any change of mind at the ECB governing council imo. The best we could expect is to see them put a firmer date on when they expect to move rates the first time. If trade wars would have calmed right down, then I wouldn’t be that relaxed but now? I don’t think so. But of course who knows with Central bankers.
US durables are due when Draghi takes the stand. They are expected to come out better than prior months, which if the case should see a mild move lower in EURUSD to test the latest bottom of the range we have been trading but not much more I reckon, as the attention will then move on tomorrow’s GDP figures.
In short I expect recent ranges to prevail with the usual whipsaw in between as algo’s will react to each word Silver Tongue will grace the audience with.
But since we’re traders, we need to be prepared for the unexpected. If the ECB/Us data combo would tear the range apart, EURUSD should break through 1.1755 or 1.1655/57. Beyond there I’ll be looking at 1.1835 on the one hand or 1.1610 on the other hand to gauge the strength of the move.
A break of 1.1835 should grant 1.1910, inversely below 1.1610, the 1.15 lows will seem very close again.
It’s not my base case. I am neutral on the EURUSD these days, been calling this range trading a few times. I wouldn’t be surprised momentum accounts try and visit either side of the second band but I would start to need to reassess if either side of 1.1610 or 1.1835 explode.