The Euro fell to a session low, accelerating lower some 3 pips in European trading on Wednesday, deflated by a comment from ECB’s governing council member Klaas Knot who said that the central bank has room to cut its deposit rate further if that would be necessary to improve financing conditions and reach its inflation target.
Dovish tone from the ECB deflates the single currency for renewed probe through pivotal support provided by 10DMA (1.2129) after the action in past four days registered daily closes above the support, keeping the pair within the range between 10 and 30 DMA’s.
Fresh weakness approaches strong support at 1.2100 (top of rising and thickening daily), above which recent dips have stalled.
Near-term action is directionless due to mixed setup of daily technical studies, with fundamentals expected to provide fresh direction signals.
Fed is ending two-day policy meeting later today and expected to stick to the current ultra-loose policy, which would increase pressure on the greenback.
Res: 1.2166,1.2183,1.2191,1.2201.
Sup: 1.2100,1.2087,1.2064,1.2053.
