EURUSD has been trading in a downtrend for some time already. Nevertheless, an attempt to launch a recovery move could have been spotted yesterday, triggered by speech by ECB members Kazaks, head of Latvian central bank . He said that ECB asset purchases may be terminated before Q3 2022 – much earlier than it was expected. Even more ECB members provided support for the euro today with their comments. Wunsch, head of the Belgian central bank, said that the return of interest rates into positive territory cannot be ruled out this year. Wunsch also said that he would support a rate hike in June. Luis de Guindos, ECB Vice-president, said that the Asset Purchase Programme may be terminated in July with the first rate hike following the same month. EUR traders should keep on guard around 6:00 pm BST today as ECB President Lagarde will take part in the IMF debate on the global economy.
Taking a look at EURUSD chart at H1 interval, we can see that the pair has managed to break above the neckline of a local inverse head and shoulders pattern. Recovery move was briefly halted at the upper limit of the market geometry (1.0870) but today’s comments from ECB members helped the pair regain ground. A strong upward move was launched in the European morning hours and the pair managed to break above the upper limit of market geometry. It looks like the way towards the next resistance, marked with previous local high and 38.2% retracement of the downward impulse launched at the end of March, has been opened.