Euro rises 0.5% against the dollar ahead of ECB

EURUSD

EURUSD is trading up 0.70% at 1.0971

The euro and other European currencies edged up on Wednesday ahead of this week’s central bank meeting and supported by reports that the European Union was discussing joint bond issuance to finance energy and defence spending.

After touching a 22-month low on Monday sliding to as much as $1.0806, the euro rose 0.5% on the day to $1.0946 helped by a report citing unnamed officials that said the European Union was discussing joint bond issuance.

Sterling rose 0.3% against the dollar to $1.3134. But analysts also said the euro is unlikely to rise much while there is so much worry about the war in Ukraine spreading.

Other European currencies such as Poland’s zloty and Hungary’s forint rebounded from record lows against the euro, both supported also by their central banks’ sharp interest rate hikes on Tuesday.

The European Central Bank meets on Thursday but amid the spectre of stagflation, money markets expected policymakers to delay rate hikes until late in the year.

The U.S. dollar against a basket of currencies including the euro was 0.35% lower at 98.764, just below a 22-month peak touched on Monday.

Some commodity currencies such as Australian and kiwi dollar – eased from recent peaks amid fears war-driven surges in energy, grains and metals could crimp long-term demand.

On technical fronts EURUSD RSI stood at 26.24 and currently it is trading above 5 days MA & below 20 and 50 days MA. So, SELL position can be taken with following target and stoploss:

TRADE SIGNAL – : EURUSD – SELL: 1.0965, TARGET: 1.0927, STOP LOSS : 1.1006

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