EUR/USD – Fundamental Vs Technical Analysis

Fundamental EUR/USD – ‘What ever it takes’ message may continue 

Mr Mario Draghi may play the same drum once again today so that that the market gets the sound which it received back in August. There is no doubt that the biggest economy of the Europe- Germany is showing a strong growth rate with a strong possibility of the spill over effects, but the peripheral countries are still not strong enough still to make them stand on their own feet yet, which leaves Draghi to keep believing the market that the ECB will certainly still stand by their phrase of ‘Whatever it takes’. I would say that the main challenge for the ECB is the forward guidance because we do certainly have some growth in the ECB but it’s the ECB pledge to keep the interest rate down for the extended period of time which could be challenging.

Technical Analysis

GBP- Fundamental Vs Technical Analysis

Fundamental GBP/USD.  There may not be any firecracker in BOE’s Bank Rate

The FTSE 100 is trading higher during the early hours of trading. However, the volume is thin in the market as we are not seeing any bigger trades from investors ahead of the Bank of England’s meeting.  I am not expecting any surprise or any kind of firework which could color up the sky in this meeting, as the UK’s economy is already building up the steam. You may think that Mr Carney has inherited a good fortune however, he also has inherited tough challenges, as the committee has pledged to keep the interest rate at 0.5% which presents a clear problem when it comes to sustain the inflationary pressure.

Technical Analysis