EUR/USD - EUR/USD Profits Locked Before Draghi’s Speech! - 03/11/2016 (GMT)

EUR/USD Profits Locked Before Draghi’s Speech! Double Bottom Formation!

The EUR/USD pair plunged immediately after the rate announcement and penetrated successfully the suggested targets, first at 1.0920, then at 1.0900 and then at 1.0825, ending the day in profit (100 pips)! Following the rate announcement by the European Central Bank – lowered its deposit rate by 10 basis points to -0.4% and shaving the marginal lending rate to 0.25% from 0.3% – the pair recovered heavily and surged above the significant level of 1.0900 to end the session near 1.1200.

Technically, the EUR/USD pair has made a double bottom – weekly chart – before its reversal to take out various import levels of resistance, with the neckline around 1.1400 – 1.1500 area and bottom at 1.0500. Should we see a break through the neckline, it could prompt a move towards 1.2000, based on the size of the double bottom projected above the neckline. This is roughly a 50% retracement of the move from 1.4000 high to the low at 1.0450. The key between 1.1500 and 1.2000 is 1.1700, August high.