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The ECB is up in a few hours!

Will the central bank’s decision extend the euro’s low key downtrend against the dollar?

Before we talk setups and expectations, check out the biggest market movers during the Asian session:

Currency Snapshot

Major Forex Pairs Price Performance from MarketMilk
Major Forex Pairs Price Performance from MarketMilk

Fresh Market Headlines & Economic Data:

Upcoming Potential Catalysts on the Economic Calendar:

  • France’s flash GDP at 5:30 am GMT
  • Germany’s retail sales at 6:00 am GMT
  • Switzerland’s retail sales at 6:30 am GMT
  • Swiss KOF economic barometer at 7:00 am GMT
  • Spain’s quarterly GDP at 7:00 am GMT
  • Germany’s unemployment change at 7:55 am GMT
  • Italy’s unemployment rate at 8:00 am GMT
  • Euro Zone’s preliminary GDP at 9:00 am GMT
  • Euro Zone’s CPI flash estimate at 9:00 am GMT
  • Euro Zone’s unemployment rate at 9:00 am GMT
  • Italy’s quarterly GDP at 10:00 am GMT
  • ECB’s policy decision at 11:45 am GMT

What to Watch: EUR/USD

EUR/USD 1-hour Forex Chart
EUR/USD 1-hour Forex Chart

In a few hours the European Central Bank (ECB) is expected to share its policy decisions in April.

While analysts aren’t expecting major policy changes, most expect Governor Lagarde and her team to step up their bond-buying so they can be more effective as a lender of last resort to euro zone economies severely hit by the pandemic.

Meanwhile, the dollar lost some of its shine in the last couple of trading sessions thanks to overall risk-taking. Aside from some key economies slowly restarting, promising news over a drug for the virus have also turned traders away from the safe haven dollar.

If the ECB fails to project a “do whatever it takes” message to the markets, then we could see the euro drop back to its April lows near 1.0760.

If Lagarde and friends successfully reassure markets, however, or if the anti-dollar theme extends to the next trading sessions, then EUR/USD can break above its descending channel and make its way towards previous areas of interest like 1.0950.

Not sure where to place your entry and stop loss levels? This EUR/USD volatility analysis tool can help you out!