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Levels to watch ahead of ECB Policy Meeting

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The EURUSD pair found strong support at the 1.2571 level during yesterday’s session and rebounded higher moving aggressively above the psychological level of 1.2600 level ahead of the ECB policy meeting later in the day.

Currently, the euro is trading near the key level of 1.2650 and it seems that the number of attempts are increasing, in order to reach the psychological barrier of 1.2715 for a retest. The 4-hour chart in the EURUSD suggests more euro strength, while momentum indicators are moving upwards, keeping the pressure to the upside.

Therefore, if the bulls hold the price above the strong support levels of 1.2570 and 1.2600, it may suggest that traders took profits around that zone and are preparing for the correction phase, towards the psychological level of 1.2800, which includes the 50-period SMA as well as the first descending trend line, which started back in August. On the other hand, if the bulls fail to maintain price action above the 1.2570 – 1.2600 zone, then we could see further pressure on the bottom and at the 1.2520 area.

Furthermore, today’s ECB meeting is likely to have a significant impact on the direction of the pair, including the US NFP report on Friday.

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