Global macro overview for 21/04/2016:
The ECB interest rate decision and monetary policy statement are the main events of the week and they are happening today at 11:45 GMT. The market participants do not expect any further rate cuts as the current level is 0.00% already. ECB head Mario Draghi has clearly stated at the last meeting that a negative interest rate is not currently taken into account. Nevertheless, investors are uncertain how the central banker will try to communicate with them, so Mr. Draghi is expected to be more careful about his choice of words seeking to reassure investors that the ECB can still impact economic growth in the Eurozone and fight off the threat of deflation. In conclusion, there are no surprises expected today and the main focus of investors will concentrate on the press conference after the rates are announced.
Let's now take a look at the current technical picture of EUR/USD on the 4H time frame ahead of the ECB rate decision. After breaking slightly above the 615 Fibo of the last swing, the market got rejected and bears pushed the price towards the level of 1.1300. Currently the market trades at the intraday trend line support around the level of 1.1290 and any breakout lower would suggest the next support at the level of 1.1232 will be tested again. Moreover, please notice that the recent sell-off from the swing high at the level of 1.1465 is the biggest downside correction so far, so the overbalance scenario is still at the table.
