Even though the European single currency edged higher against the Japanese Yen on Wednesday, it was unable to maintain trade above the 122.00 mark, with the resistance cluster there pushing the exchange rate down again. As a result, this cluster caused the EUR/JPY cross to make a U-turn and begin moving towards the 121.20 psychological support. Technical indicators, however, are unable to confirm the possibility of the negative outcome, as they keep giving bullish signals. In this case the 121.60 handle should be considered as a possible support, as it kept the Euro from sliding down for a whole week now, suggesting trade could close above this area.
The European Central Bank (ECB) made no changes to its record-low interest rates and announced no new measures on Thursday in what was its first policy decision of 2017. Specifically, the ECB left its benchmark interest rate unchanged at a record-low 0.0%, in line with forecasts. The central bank also held its deposit facility rate steady at -0.4% and its marginal lending rate remained at 0.25%. Additionally, the Governing Council confirms that it will continue to make purchases under the asset purchase programme (APP) at the current monthly pace of €80 billion until the end of March 2017 and that, from April 2017, the net asset purchases are intended to continue at a monthly pace of €60 billion until the end of December 2017, or beyond, if necessary, and in any case until the Governing Council sees a sustained adjustment in the path of inflation consistent with its inflation aim.
The euro may not exist in ten years’ time if Paris and Berlin fail to bolster the single currency union. The warning has come from the French presidential candidate Emmanuel Macron in a speech at Humboldt University in Berlin on Tuesday, as cited by Reuters. Macron was economy minister under Socialist President François Hollande until he resigned this year to create his own political movement and stand as an independent candidate in this year’s presidential election. The truth is that we must collectively recognize that the euro is incomplete and cannot last without major reforms,” Macron added.
Stoxx 600 index had in the first two months of 2015 an incredible performance of about 25%, resulting the best equity index where to invest. But unluckily, in the month of April, the situation changed when the Index arrived at the 400 price level zone, a point where we had in the past, in 2000 and 2007, the beginning of two bear markets. But this time, after the third historical top, prices created a double bottom at 300. Then in 2016 we had a trending range between 300 and 350 that was broken at the beginning of December.
The European Central Bank will extend its asset purchase program to the end of December 2017, but at a reduced monthly pace. The ECB said on Thursday it would extend its so-called quantitative easing program by nine months, until at least the end of next year, taking its total size above €2.2 trillion ($2.36 trillion). But starting in April, the bank will reduce the value of securities it buys per month to €60 billion from €80 billion.
he European Central Bank (ECB) on Thursday confirmed monthly purchases of $80 billion in government paper, known as the quantitative easing (QE) programme while interest rates remained flat or come lower for a prolonged period with the principal rate at 0.00%, the bank deposit rate at -0.40% and refinancing rates at 0.25%.
The common European currency traded below the 1.1050 level against the Greenback on Wednesday, as it had found resistance in the second weekly support level at 1.1043. Previously, as the currency exchange rate slowly moved through the first weekly and monthly support at 1.1121 and 1.1133, it plummeted down to the 1.1043, as soon as the before mentioned support levels were passed. It is most likely that the currency pair will move lower to mark new low levels, as it nears the Brexit low level.
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