Here we are tracking the flows post ECB in EURUSD. A lot of updates on the monetary side, the ECB introducing two tiered deposit rates attempting to protect credit channels whilst reducing the effects in FX on lower rates.
To put simply, tiering is there to act as a shield with front-loading effects and keep Deutsche Bank et al “alive” till the end of the year. The absortion of EUR liquidity from interbank markets effective pushes up relative ECB deposit returns.
Smart money is tracking this closely and stopped the breakup for the European opening range. Draghi calling for fiscal assistance (and is absolutely right btw...there is a necessity for fiscal expansion to poor investment opportunities for pension funds in the area) will be enough to sweep the lows once more in my view before Fed.
Best of luck all those tracking the range from the live room, we can keep our invalidation level above the range highs whilst target again 1.093x and 1.082x for a clean sweep.
Thanks.
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1.09399 low... First targets cleared... Well done shorts, time to trail stops and look for the home run.