CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

ECB meeting: what to expect?

12:22 21 January 2021

Will EURUSD resume the rally?

The ECB meeting is the key position in today’s calendar with decision expected at 12:45pm (GMT) and conference about to begin 45 minutes later. This events has often significant impact on DE30 and EURUSD.

What to expect?

The ECB would never admit it, but it’s actually out of ammo in terms of any reasonable tools affecting the economy. A combination of negative rates (-0.5% deposit rate) and huge QE (about 80 billion euro per month) has done little other than boosting asset prices. The maximum size of the key PEPP  program was increased in December (to 1.85 trillion euro) and duration to March 2022 and thus ECB must hope to stay put for an extended period of time.

One factor that worries the ECB is the rate of the EURUSD. Higher EURUSD contains euro area growth and inflation but the ECB has refrained from interventions. If anything, ambiguous comments about the euro from Christine Lagarde (ECB president) caused EURUSD rallies during the past conferences – so traders should watch for these today.

What are the key levels to watch?

DE30 is fighting to close above 14000 today and if the ECB is too soft on the euro this could be a potential problem. Meanwhile, the EURUSD has returned to gains lately after rebounding from 1.2050 with the key support level untouched at 1.20. The next key resistance is recent high of 1.2350.

We will report the outcome of the ECB meeting in the News section. 

This content has been created by X-Trade Brokers Dom Maklerski S.A. This service is provided by X-Trade Brokers Dom Maklerski S.A. (X-Trade Brokers Brokerage House joint-stock company), with its registered office in Warsaw, at Ogrodowa 58, 00-876 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. X-Trade Brokers Dom Maklerski S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.

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