Meek effort today on both sides of the trade
The chart in the euro tells the story at the moment. There’s a slight downward drift over the past three weeks but in general, there isn’t much life. The full range since June 29 is 150 pips. It’s especially stark because there has been a healthy amount of volatility in broader markets this month.
Today’s ECB meeting was a fresh opportunity to kick the trade into gear but Lagarde didn’t offer anything new and policy is stuck at the lower bound indefinitely.
At some point, something has to move this chart. I thought we might see some positive signs in today’s eurozone consumer confidence report but instead it fell to -4.4 from -3.3. It’s been on a steady climb from -14 at the start of the year so a one-month setback is forgivable but in the next few months the bulls need to see some real life in the economy.
I’m optimistic technically so long as 1.1700 holds. From here that offers a nice risk-reward setup but I struggle to see a catalyst.