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EUR/JPY binary signal - ECB President Draghi Speech - 12 Oct 2017

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Expiry Time: 
20:00 GMT
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The European Central Bank President, Mario Draghi is expected to speak today at 14:30 GMT. Draghi's speech comes as he participates in a panel discussion on monetary policy at the Peterson Institute for International Economics in Washington DC.

There is a good chance that Draghi could use this opportunity to talk about the ECB's monetary policy practices over the past few years. However, he could refrain from giving any explicit details on the upcoming plans. The ECB is expected to meet later in October for its monthly monetary policy review.

Investors are expecting that the ECB will announce further tapering to its bond purchase program. The central bank is widely speculated to reduce its bond purchases by 20 billion euros, bringing its monthly bond purchases to just 40 billion euro. This is half of the bond purchases that the ECB started with when the central bank's QE program was launched few years ago.

Economic data in the Eurozone continues to improve at a steady pace. Although inflation remains low, the prospects are high that consumer prices could start to increase from next year. This is expected to bring inflation closer to, if not overshoot the ECB's inflation target rate.

However, ECB officials have also maintained in the past that inflation could decline by early 2018 but attributed this mostly due to a statistical error rather than weakness in the economy. Earlier this week, the short term headwinds for the euro also receded as the region of Catalonia held back from declaring independence. This saw the euro managing to post some gains.

The FOMC meeting minutes also did not reveal anything new for the markets with the speculation that the Federal Reserve will hike rates this December. Besides Draghi, other FOMC members due to speak today include Brainard and Powell.

Based on the above, today's forex binary signal is EURJPY. The currency pair has been seen consolidating above 132.00 after rising to highs near 134.40. Resistance is seen at 133.0 which was breached recently.

Therefore, we are looking to purchase daily CALL options at 133.10 for a 20:00 GMT expiry time. We expect EURJPY to pullback to this broken resistance level where support will be established as EURJPY attempts to close higher on the day.

binary options signal eurjpy 12 Oct 2017

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion. All risks and coasts associated with online trading are your responsibility.