It was a pretty volatile day as the market reacted dramatically on the release of ECB rate decision on Thursday. The ECB declared a quantitative easing (Q.E.) plan that involves 20 billion euros per month. The central bank also lowered its primary deposit rate by ten basis points to -0.5%, in line with investor forecasts.
Besides, the U.S. President Donald Trump used the events to repeatedly blame the Federal Reserve of not extending enough support to the U.S. economy.
Today, the market will be focusing on U.S. retail sales and core retail sales data to determine future trends.
Economic Calendar – Retail Sales on the Cards
BTC/USD – Daily Analysis
On Friday, the Bitcoin is trading bullish, after trading sideways for a week. The market focus was mostly stuck at the ECB policy decision, which is finally over.
BTC/USD surged over 2% at its current value of $10,315, which indicates a wave from its immediate lows of $10,000 that was set yesterday.
Bitcoin finally made a slightly bullish move to place a high of around 10470. It has crossed the 50 periods EMA on the upper side, which is signalling a bullish bias among crypto traders. On the technical side, the BTC/USD may show a slight retracement ahead of showing a continued bullish trend.
BTC/USD – Daily Technical Levels
Pivot Point 10,498.09
BTC/USD – Daily Forecast
The BTC/USD has not changed much as investors focus stayed on the ECB monetary policy meeting, which drove massive movements in the gold and EUR/USD. Bitcoin continues to gain bullish momentum to trade below double top resistance area of around 10400. The violation of this level can extend bullish rally until 10770 and 10925 areas. Elsewhere, support can be seen around 10350. Bullish bias seems strong today.
EUR/USD – Dovish ECB Shakes the Market
The European Central Bank confirmed a further stimulus package as anticipated on Thursday, lowering interest rates and allowing a new series of bond-buying program to help boost eurozone growth and prevent a worrisome decline in inflation forecasts.
The ECB meeting outcome was widely in line with our previous forecasts. The first variation was in the Asset buying program. The volume of EUR 20bn was on the weak side, and the point that the ECB did not address increasing the issuer boundaries will be a pressure on the program moving forward.
The package was a reply to the further protracted instability seen in the Euro-area market, which was further demonstrated in earthward updates to staff estimates and attempted to tie inflation estimates close to the ECB’s aim.
As a result, the EUR/USD took a sharp bearish turn but reversed to trade at its initial selling level of around 1.1065. Let’s look at the technical side of the market below.
EUR/USD – Daily Technical Levels
Pivot Point 1.1035
EUR/USD – Daily Forecast
European Central Bank has voted to restart its Q.E. program and hit banks with deeper negative interest rates to make them lend. The initial response was pretty bearish, but it was something every investor was expecting.
Therefore, the EUR/USD pair reversed to trade at the same old zone of around 1.1060. For now, the violation of 1.1070 level can drive the bullish trend in EUR/USD until 1.1125 and 1.1150 area.
GBP/USD – Sideways Pattern Remains Intact
On Friday, the British Pound continues to trade sideways within a narrow trading range of 1.2380 – 1.2330. Investors focus mostly shifted towards the ECB rate decision and fresh stimulus program, which somehow dragged all the attention and trading volume towards the EUR/USD pair.
Fundamentally, the Sterling is still on the weaker side over Brexit uncertainties. The United Kingdom may suffer interruption to drug stocks, escalating food expenses, and possibly public jumble on its roads in the event of a no-deal Brexit.
British PM Boris Johnson’s government showed that estimate in August and later specified the situation as a “base-case” one. Well, previously the British government refused the forecasts – called “Yellowhammer” and published by the Sunday Times – as outmoded. The government should have taken it seriously to avoid such uncertainties.
By the way, the investors are feeling less confident of keeping their funds in the British Pound until everything is resolved.
GBP/USD – Daily Technical Levels
Pivot Point 1.2304
GBP/USD – Daily Forecast
Sterling still has strong support at 1.2300, and the bearish breakout can trigger a sell-off until 1.2255. While the continuation of a bullish trend and breakout of 1.2370 resistance can lead GBP/USD towards 1.2400 and 1.2424.
All the best for today.