The price of EURUSD price rejected the monthly value area low after the ECB hiked rates. What levels should you look out for now?
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The EURUSD price fell after the ECB hiked interest rates by 75bps seeing the rate rise to 1.25%. The price rallied into the monthly value area low before finding resistance and dropping lower. The markets were expecting this outcome from the ECB as the inflation rate rose to 9.1% in Europe in August. The ECB have announced they will continue to hike rates further but this could still be considered a little too late.
The price rallied into the monthly value area low and rejected. The lack of buyers around these areas suggests the market is more likely to trade lower. If the price breaks through the lows around 0.9900 we could see a continuation down into the September 2002 lows. If however, the price does break back into the monthly value area and above the previous highs of 1.0100 we could look for the price to trade to the other side of value. This move however would take something drastic to change from the fundamental outlook.
Did you see our USDJPY Analysis? You can see it here.
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