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Forex pairs in this Article » EUR/USD (Edinburgh) -The EUR/USD is attempting to stabilize in the vicinity of 1.3520/25, as US markets are slowly drawing to a close on Wednesday.

EUR/USD gearing up for the ECB

The ECB meeting due tomorrow has become an even closer call amidst increasing uncertainty regarding the tone of the statement – that is, dovish or more dovish – and the subsequent press conference by President M.Draghi. While bias has been tilted to the dovish camp since the release of the CPI figures, recent comments by Draghi prompted investors to think about other outcomes from the meeting. “Our base case is that the ECB will strike a far more dovish tone, laying the foundation for an interest rate cut and LTRO at the December 5th meeting. We expect that diverging central bank policy between the US and Europe and the limited tools available to the ECB will drive a weaker EUR”.

EUR/USD levels to watch

The pair is now up 0.37% at 1.3521 with the initial resistance at 1.3548 (high Nov.6) followed by 1.3589 (high Nov.1) and finally 1.3591 (38,2% 1.3833-1.3442). On the downside, a break below 1.3465 (50% of 1.3105-1.3826) would target 1.3442 (low Nov.4) en route to 1.3421 (38.2% of 1.2755-1.3833).
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