Fundamental overview:
EUR/USD is expected to consolidate with risks skewed lower as markets are awaiting 1245 GMT European Central Bank monetary policy decision. The Wall Street Journal reported Wednesday a proposal from the ECB's executive board that calls for monthly bond purchases of roughly EUR50 billion, lasting for at least one year, suggesting bond purchases could amount to at least EUR600 billion. EUR/USD is undermined by the prospect of the large-scale ECB quantitative easing, the positive dollar sentiment, and fears of Greece exit from the eurozone if the anti-austerity left-wing Syriza party wins the snap elections Sunday and renege on the country's reform program. But EUR/USD losses are tempered by the subdued risk aversion.
Technical comment:
Daily chart is negative-biased as MACD is bearish, stochastics stays suppressed at oversold levels, five- and 15-day moving averages are declining.
Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below the pivot point. Short positions are recommended with the first target at 1.1540. A break of this target will move the pair further downward to 1.1510. The pivot point stands at 1.1680. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, a long position is recommended with the first target at 1.1720 and the second target at 1.1755.
Resistance levels:
1.1720
1.1795
1.1845
Support levels:
1.1540
1.1515
1.1450