EUR/USD: Bulls defending 1.15 handle ahead of ECB

The EUR/USD pair extends its defensive mode into Asia, although holds above 1.15 handle, as investors gear up for the ECB monetary policy decision for the next direction.

EUR/USD: ECB to disappoint the hawks?

The spot remains better bid so far this Thursday, having stalled its corrective-slide at 1.1510 from multi-month tops of 1.1583. The sentiment around the EUR/USD pair remains buoyed amid a broadly subdued US dollar, as Treasury yields remain on the back foot, with investors digesting the latest headlines surrounding the US politics.

US House budget committee approves fiscal 2018 budget plan that could be path to tax overhaul

 Further upside, however, appears to lack momentum, as markets remain cautious over the ECB’s next policy move, which is widely expected to be announced today. Goldman Sachs’ analysts noted: “We leave our forecast of ECB policy unchanged. This includes that we expect no change in policy rates or asset purchases for the reminder of 2017. We expect the ECB to taper its asset purchases gradually during 2018. We do not expect a rate hike until 2019.” 

Here's Why the ECB (Draghi) Could Disappoint

Ahead of the ECB policy decision, the BOJ policy outcome will provide fresh trading impetus to the USD/JPY pair, which could have a major impact on the USD dynamics and eventually on EUR/USD.

EUR/USD Technical Set-up  

According to Valeria Bednarik, Chief Analyst at FXStreet, “Technical indicators in the mentioned chart have corrected extreme overbought readings before losing downward strength within positive territory. The bearish potential will increase on a downward acceleration below 1.1490, while the key resistance comes at 1.1615, May 2016 high, with gains beyond the level favoring another 100 pips' gain. Support levels: 1.1490 1.1460 1.1420 Resistance levels 1.1550 1.1580 1.1615.”