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15 Apr 2015
Insights to ECB QE session and subsequent price action - TDS
FXStreet (Guatemala) - Analysts at TD Securities explained that there will be a 100% chance that all rates will be left unchanged at the ECB meeting and offer other insights in to the Q&E session and subsequent predictions of the effects on the Euro.
Key Quotes:
"75%: Draghi sticks to a cautiously optimistic tone, continuing to reinforce the mantra that the ECB assumes full implementation and will not run out of bonds to buy and has seen nothing in market liquidity to suggest an issue, providing no real answer on questions regarding Greece. No new news in this instance reinforces carry trade potential. EURUSD can likely grind slightly lower, unable to break the 13 April low of 1.0521."
"10%: Draghi's tone on Greece suggests the ECB has dug their heels in further on providing liquidity. EUR/USD breaks above 1.0715 (last week’s lows) but struggles to move far beyond that."
"5%: Draghi opens the door to a possibility of tapering in 2016. EUR/USD breaks above 1.0715 (last week’s lows) and can close in 1.0910 (40dma) depending on how far he opens the door."
"10%: Draghi's language suggests ongoing expectation euro continues to decline, or when asked on concerns with negative rates and CHF 10y issuance at negative rates, he outright promotes the benefits of negative rates. EUR/USD likely tests the 16 March low of 1.0458, with a small chance we trade through there, opening up 1.0390."
Key Quotes:
"75%: Draghi sticks to a cautiously optimistic tone, continuing to reinforce the mantra that the ECB assumes full implementation and will not run out of bonds to buy and has seen nothing in market liquidity to suggest an issue, providing no real answer on questions regarding Greece. No new news in this instance reinforces carry trade potential. EURUSD can likely grind slightly lower, unable to break the 13 April low of 1.0521."
"10%: Draghi's tone on Greece suggests the ECB has dug their heels in further on providing liquidity. EUR/USD breaks above 1.0715 (last week’s lows) but struggles to move far beyond that."
"5%: Draghi opens the door to a possibility of tapering in 2016. EUR/USD breaks above 1.0715 (last week’s lows) and can close in 1.0910 (40dma) depending on how far he opens the door."
"10%: Draghi's language suggests ongoing expectation euro continues to decline, or when asked on concerns with negative rates and CHF 10y issuance at negative rates, he outright promotes the benefits of negative rates. EUR/USD likely tests the 16 March low of 1.0458, with a small chance we trade through there, opening up 1.0390."