Global macro overview for 30/04/2018

Thursday's release from the ECB was not a clear pretext for the sale of the euro, but at the same time did not give enough reasons for buyers to stand in the way of the general appreciation of the dollar. In the statement, everything except date was unchanged compared to the March meeting. At the press conference, President Draghi was somewhere between neutral and dovish. On the one hand, it did not show much concern about the latest series of weaker macro data. In his opinion, the slowdown in the pace of expansion and normalization in the data was expected, although the weakening of some indicators was unexpected, but also drew attention to the impact of one-off factors. The ECB expresses confidence in the continuation of inflation strengthening, which is supported by satisfactory signs of wage increases. On the other hand, Draghi added some doubts in the context of the pace of normalization, because he said that the Governing Council did not discuss the future of QE, nor what it would do at the next meeting in June. This statement, in the market's judgment, leaves open the way for leaving this decision for later (eg for July).

Let's now take a look at the EUR/USD technical picture on a larger time frame, like a daily interval. If Draghi wanted not to give any direction signal for EUR, I think it worked. However, "zero" for EUR and "plus" for USD resulted in the euro-dollar congress in the accompaniment of other cross-count against the dollar. The overhang of short positions in USD, collected since the fourth quarter of 2017, is large, and in the case of EUR/USD - the highest, and if the conviction to the dollar is drastically reversed, balancing the position will not end in one week. But the most brutal part of the trade seems to be behind us and with the next possible wave, investors may want to wait for a fresh impulse in the data. In this context, however, I would not count on the indications during the next couple of days, because what will come out less in this quarter will be recovered in the next with the additional help of the effects of tax reform. If you already look for signals from macro data, then ED interest rate decision and statement, ISM, NFP are worth to keep an eye on in the coming week.