Yesterday’s Trading:

On Wednesday Tuesday’s maximum was shifted by three points and profit was fixed on long positions. Due to the strengthening of the dollar and a fall in the euro/pound, the euro/dollar by the end of the day had fallen 95 points to 1.1295. Traders were selling euro before the ECB convenes.

Additional pressure on the euro came from American stats. Sales of housing in the secondary market were higher than expected: 5.33 million in March against 5.08 million in February (forecasted 5.3 million).

Market Expectations:

A rise in oil prices is helping increase demand for risky assets and support commodity currencies. Despite this, the Aussie and Canadian have strengthened only slightly against the USD in Asia. Demand for the dollar will remain until 15:30 EET. At this moment, demand/supply for the currency will depend on what Draghi has to say. It’s difficult to imagine what Draghi could surprise participants with. Before 15:30 EET I expect a strengthening of the euro to 1.1305.

Day’s News (EET):

11:30, UK RPI and state borrowing in March.

14:45, ECB interest rate decision;

15:30, ECB’s Draghi to hold a press conference, US Philadelphia Fed PMI for April and initial unemployment benefit applications for the week ending 17th April;

17:00, Eurozone consumer confidence in March, US Conference Board leading indicator index for March and BoE’s Carney to speak.

Technical Analysis:

The euro/dollar fell to the MA of D1. The euro has reached for the support near the 90th degree. It’s not 100% that the price will stray from there. During Draghi’s speech, the pair could drop to 1.1220 and return back to 1.1340 or 1.1360. There’s no point shutting our eyes and crossing our fingers since no one knows what Draghi is to come out with at his press conference. In my forecast I’ve gone for a rebound to 1.1300-1.1305.

Source: alpari.com, "Euro Rate Falls Before ECB Meeting"