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ECB Press Conference: Draghi's Key Points and EUR/USD reaction

The ECB expects a "prolonged" period of low inflation which will come back in to near the 2% target by the end of 2016. He regards the 0.5% March inflation to be a low and that it will slowly pick up from there.

Room for more action:
In answering questions, he noted that the ECB not exhausted conventional and unconventional measures like QE.

Concern of a strong Euro:
Draghi mentioned an increasing impact of the Euro as it rallies.

Recovery slower than US:
Draghi noted that the recovery in the US is more advanced than in the Euro area. I believe this is important for EUR/USD as it suggests a divergence in monetary policy bias between the ECB and Fed.

The EUR/USD shook up and down, but eventually ended with a bearish reaction to the ECB event risk. It is looking at this week's low near the 1.37 handle. A break below that should open up some near-term bearish outlook, extending one that began when the pair retreated from the 2014 high of 1.3966.

(EUR/USD 1H chart 4/3)

A return above this week's high of 1.38, and a break above a falling channel resistance, which could be coincident with 1.38 by the time this happens, would revive a prevailing bullish bias in the medium term.

In the short-term however, EUR/USD remains bearish after today's ECB event risk, though the market might temper with the bearishness ahead of tomorrow's US NFP.