EUR/USD: German constitutional court ruling sends it lower
ECB required to show justification else risk losing Bundesbank participation.
EUR/USD Technical analysis, overview, strategies, and levels
The euro was an underperformer amongst the FX majors following Germany's constitutional court ruling that requires the ECB (European Central Bank) to justify purchases on its bond-purchasing program as being necessary and proportionate, else lose the Bundesbank as a participant who would be forced to sell off over half a trillion euros of its bond assets. The result sent the euro lower and periphery yields higher, and the fear is that it could spread to its recent coronavirus programs such as PEPP (Pandemic Emergency Purchase Programme). Twice EUR/USD's price crossed below yesterday's 1st Support level, the first time offering conformists a buy-on-reversal opportunity before crossing below the last of its main moving averages. We've got plenty of Eurozone data today including services PMIs (Purchasing Managers Index), before focus shifts to the US dollar with ADP's non-farm estimate.
IG client* and CoT sentiment for EUR/USD
In sentiment, retail bias has shifted to majority long as shorts get enticed into closing out and longs initiate.
EUR/USD Chart with retail and institutional sentiment
*The percentage of IG client accounts with positions in this market that are currently long or short. Calculated to the nearest 1%, as of today morning 8am.
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