However, we should not forget that the eurozone economy is gradually slipping into recession, and now you can see the lack of measures that the European Central Bank resorted to during the September meeting. Let me remind you that the regulator lowered interest rates on deposits, and also announced a return to the bond redemption program.
The task of the future ECB President will be to smooth out all disagreements among the members of the Governing Council, since some of them, especially from Germany, are tough opponents of soft measures. It is also expected that the new head of the ECB will focus on the balance between monetary and fiscal policies.
The lack of important fundamental data yesterday kept the EURUSD pair in a narrow side channel, and a small increase in risk, which was observed at the beginning of the North American session, was offset by a weak report on consumer confidence in the eurozone. Although the report is only preliminary, the lack of optimism among consumers is a bad signal for the economy, as the decline in spending will affect retail sales, which are the main driver of GDP growth.
According to the statistics agency, the preliminary index of consumer confidence in the eurozone in October this year fell to -7.6 points against -6.5 points in September. The main problem for consumers is the trade war waged by the US against several developed countries, including the eurozone, as well as the general slowdown in global economic growth.
Yesterday, news also appeared that Republican leaders in the US House of Representatives had called for open testimony from an informant in the impeachment case before the US Congress. Michael McCall, Jim Jordan, and Devin Nunez, in their address to the head of the House Committee, said an open hearing was needed on the topic of impeachment against US President Donald Trump. Let me remind you that back in September of this year, the Democrats began an impeachment process against Donald Trump because of his interference in the elections through an attempt to discredit the political opponent. Trump denies the allegations.
As for the current technical picture of the EURUSD pair, much will depend on the level of 1.1150. Its breakthrough will renew demand for the euro, which will lead to an update of the local maximum around 1.1180, and then to an update of the larger resistance levels of 1.1225 and 1.1270. In the scenario of a decrease in risk assets after the ECB meeting, you can count on support only at the minimum of 1.1090, as well as from the local zone of 1.1050.
GBPUSD
The British pound is waiting for the decision of European leaders on Brexit. It's about granting a reprieve. The EU leaders are in a difficult position, since, on the one hand, everyone wants to complete the epic with Brexit, and this requires concessions to Boris Johnson and a short delay of 1-2 weeks, which also does not guarantee an exit from the EU. On the other hand, the provision of a longer postponement may cause Britain to leave the bloc without an agreement on October 31, which the Prime Minister of Great Britain constantly talks about.
European Council President Donald Tusk advocates a three-month postponement, while France does not see this as a need, offering to postpone a few days after the deadline of October 31 to allow the British Parliament to ratify the deal.
As for the technical picture of the GBPUSD pair, there were also no significant changes. A break of 1.2925 resistance will lead to a new wave of pound growth with reaching maximums in the areas of 1.3020 and 1.3165. If the pressure on the pound returns, with an extension of the release period by three months, then a break of support of 1.2840 will bring the trading instrument down to the lows of 1.2750 and 1.2610.