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Eyes on Draghi's Speech, EUR might Slide Trimming Its Gains

EURUSD : 4 Hour Chart

EURUSD broke out from the ascending triangle yesterday on the 4 hour chart following FOMC meeting minutes which faded the expectations among investors that Fed will increase the interest rate soon. Dollar weakened against its major counterparts. EUR however found resistance at 1.2761 and declined today as the unemployment claims data again provided support to the pair. 

Investor’s eyes are now on ECB president Mario Draghi’s speech which is scheduled at 11 AM EDT. He is likely to highlight the growing divergence in monetary policy between U.S. and the euro zone and might reiterate that the central bank is keeping all its options open for easing. Higher EUR will not be good for authorities as weaker EUR could help revive the economic growth through exports and curb the expected Deflation. So we might see the pair decline following the event.

EURUSD : Daily Chart

On the daily chart, the pair rose from the support at 1.2512 and might find resistance at 1.2831. There is another falling resistance trend line which shows that the gains are capped. The moving averages pattern also signal a downtrend continuation. So the pair remain bearish and might continue to extend losses.