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EUR/USD binary signal - ECB Draghi Speech - 21 Sep 2017

Signal details
Entry Price: 
1.1830
Close Price: 
No Trade
Direction: 
High
Expiry Time: 
20:00 GMT
How we trade
5/5 of 3 ratings

The European Central Bank president, Mario Draghi will be delivering a speech today at 13:30 GMT. Draghi will be speaking at an event in Frankfurt and comes a day after the FOMC meeting.

The Fed left interest rates unchanged at yesterday's meeting but started its balance sheet normalization program. This unwinding of the balance sheet will start the process of offloading the massive assets that the Fed amassed since the start of its QE operations following the collapse of Lehman Brothers and the 2008 global financial crisis. The Fed's balance sheet currently stands at over $4 trillion U.S. dollar and is expected to take at least four years before the balance sheet comes to more manageable levels.

The U.S. dollar was seen trading stronger on the back of the FOMC statement released yesterday and the Fed's press conference. The Fed also signaled that it could hike interest rates one more time this year.

The long term forecasts were also released with the quarterly projections which showed that inflation expectations were cut back. According to officials, inflation in the U.S. is expected to rise 1.5% this year, down from 1.7% which was previously projected. For 2018, inflation is expected to rise 1.9%, compared to previous estimates of 2%.

Today's speech from Draghi could be crucial for the EURUSD currency pair which fell sharply following the FOMC meeting. Draghi had previously expressed concerns on the exchange and there is a possibility of talking down the currency even further.

Besides the above, the ECB had earlier this week mentioned that inflation in the Eurozone could slip to 0.9% by the first quarter of 2018 which could suggest that the ECB might be looking at ways to manage its communication on QE tapering.

Based on the above today's binary options trading recommendation is EURUSD. The currency pair was seen falling off the rising wedge pattern on the daily chart and slipped below the short term resistance level of 1.1954. We expect near term declines to stall at the current support level of 1.1822.

Therefore, we would purchase daily CALL options in EURUSD at 1.1830 for a 20:00 GMT expiry time. The declines in the common currency could see a rebound as EURUSD aims to close higher on the day.

binary options signal eurusd 21 Sep 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. He has no business nor personal relationships with any mentioned government entities or stocks. 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.