EUR/USD: Massive Mark Down As ECB Reveals Dovish Trifecta

The triple news by the ECB included slashing growth, deferring exit of negative rates and the announcement of a new TLTRO, leading to a major re-adjustment of the Euro value.

The next focal point includes the US NFP figures. One must be prudence if exposure heading into the high-impact volatile event. A headline number of 181k is expected.

The breakout of the 1.12 could unravel a marked improvement in the low vol regime of the pair after many months of depressed market fluctuations.

No signs of buying interest at the elongated lows, with the latest push by the sellers even breaking through a 100% projection target based on the last POC print.

The combination of negative ECB-induced fundamental news, no progress in Brexit, risk-off tone has promoted increased supply imbalanced in the pair.

The main ‘leading’ indicator of the EUR/USD continues to be, as per the macro/micro correlation coefficients, the 10-year yield differential between Germany and the US.