The European Central Bank (ECB) has just adopted a symmetric inflation target of 2%, which contrasts with the previously held hard target at that level. Made a few minutes ago, this announcement at the ECB Strategy Review meeting represents a dovish shift by the bank but appears to have been priced in by the markets.
The Euro had climbed across the board on Thursday as hedge funds unwound risky bets against the single currency, following a rise in demand for government debt instruments and safe-haven currencies.
As of writing, the EUR/USD remains in the green by 0.37%.
Technical Levels to Watch
The daily candle has hit resistance at the 1.18395 price mark (10 March and 1 July lows). Rejection and pullback from this level targets 1.18008, with the potential for a further decline towards 1.17505 if the market acts on the recent ECB inflation target shift.
On the other hand, the price needs to break above 1.18395 to initiate the breakout from the falling wedge. This move targets 1.18927 initially, with additional targets at 1.19472 and 1.2000 as the measured move from the pattern’s breakout grinds to completion.