The Euro has successfully shrugged off the effects of the reports of the European Central Bank being uncertain about the danger of an overshoot. Also, the trader positioning and the trading signals from the options market and charts shows that the currency’s elasticity is completely intact.

The Euro Currency declined last Thursday just right after the minutes of the central bank’s newest policy meeting indicated uncertainties in which if pulled back from the stimulus gauge, will add up to the rough upsurge.

"Concerns were expressed about a possible overshooting in the reprising by financial markets, notably the foreign exchange markets, in the future,” the minutes indicated.

“The rally this year has been impressive but August has seen some of the upward momentum fade. Positive news is generating less of an impact and the latest batch of ECB minutes shows a growing disquiet with euro strength. Such sentiments could be repeated by ECB President Draghi in upcoming speeches, including at the high profile Jackson Hole symposium. As a result, we are exiting our long position in [the euro against sterling] at £0.9110 for a total return of 2.50%.” Daragh Maher of HSBC told reports.

 “While it seems unlikely that Draghi will use his speech at Jackson Hole to address policy issues it is also clear that the most effective way the central bank can tackle unwanted euro strength will be to start downplaying the likelihood of any reduction in the asset purchase programme.” BNY Mellon’s Simon Derrick told reports.

Trading Performance


On Friday however, the indicator increased at the $1.1728 level which is a surge from its $1.1660 decline on Thursday’s results. Logically, analysts have been reflecting in admittance of the the suggestions of the ECB’s standpoint.

The Relative Strength Index is somehow indicating an upsurge as it is 56.06. It may trade within this region of 50’s for quite a while but with the performance above, it is possible that it may reach beyond the 60’s region soon.

However, the Coppock Curve has not been mirroring the same performance as above. The indicator was seen trading downwards towards the 0.16. It is apparently nearing the negative region as well and despite being on the positive zone, a better hold on buy would be advised as it is quite risky to take any strong buy with this kind of performance.

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