EURUSD (1.2452): The common currency was seen building up on the bullish momentum as the EURUSD soared to fresh monthly highs on Monday. The gains came amid a slow trading day but the common currency got a boost from hawkish comments from ECB’s Weidmann. Weidmann said that the ECB should phase out its stimulus purchases in order to give itself more room in the future in case the economy slows. Weidmann also commented on interest rates in mid-2019 calling it “not entirely unrealistic.” The euro currency was seen breaking past the 1.2363 handle where support was established. This quickly resulted in a strong rally. However, we expect the gains to post a correction in the short term especially with the bearish divergence seen on the 4-hour charts. Any declines are likely to stall back at the 1.2363 level in the near term.
