Interest rate futures pricing is just a 20% chance of a 50 BP ECB hike

Interest rate futures now price a mere 20% chance of a 50 basis point ECB hike tomorrow. The ECB’s rate decision will take place at 9:15 a.m. ET (adjusted for the US daylight saving time change this week).

EURUSD has retreated to the low of the day (recently trading at 1.0520), now dipping below last week’s low of 1.05236 and breaking through the swing zone between 1.05236 and 1.05323 . The currency pair is also moving away from its 100-day moving average at 1.05488 (blue staircase line in the chart above), which now serves as a risk level for sellers. Staying below this level suggests a more bearish outlook. However, a return over the top could indicate disappointment due to the failed break attempt.

The next target area is near the swing zone between 1.0480 and 1.04906 (see the numbered red circles on the four-hour chart below).

This article was written by Greg Michalowski at www.forexlive. com.


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