Anyone can tell me why ECB raised interest rate .25% but made the EURO decline ? | Forex Factory

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Anyone can tell me why ECB raised interest rate .25% but made the EURO decline ?

  • #1
  • First Post: Oct 5, 2006 9:57am Oct 5, 2006 9:57am
Anyone can tell me why ECB raised interest rate .25% but made the EURO decline ?It's suppose strenthen and EURO/USD up,but drop more than 30-40 points?
  • #2
  • Oct 5, 2006 10:02am Oct 5, 2006 10:02am
Quoting super84
Anyone can tell me why ECB raised interest rate .25% but made the EURO decline ?It's suppose strenthen and EURO/USD up,but drop more than 30-40 points?
I'm sure there are a lot of answers, but my 2 cents worth is that the rate hike was already priced in, Trichet was somewhat dovish, and the US unemployment figures were good.

Therefore, its the "buy the rumour, sell the news principle..."

GirlFlyer
  • #3
  • Oct 5, 2006 10:10am Oct 5, 2006 10:10am
Thanks ...

But after this ,izzit posible EURO/USD will bounce back to level 1.27++?
Or cont decline until break the support line at 1.2650?
  • #4
  • Oct 5, 2006 10:21am Oct 5, 2006 10:21am
everyone knew that was going to happen. Theory: some traders establish positions in hopes that the rate change will be a surprise and raise higher than expected. Then close position when report comes in as expected.

Probably some jobber just filled an order or it was just flowing that way. The market is never wrong, just check your equity balance.... it is always right.
happy trading
  • #5
  • Oct 5, 2006 10:29am Oct 5, 2006 10:29am
I´m a believer

I have seen the light. The Church of Trendism has truly changed me. I seek to follow the light with my lagging indicators though I know not where it will lead me. The market knows all and , yea, this trader knows nothing. Such is the path to an ascending equity curve. Peace.
Johann Channels and cycles are everything
  • #6
  • Oct 5, 2006 10:40am Oct 5, 2006 10:40am
Quoting super84
Thanks ...

But after this ,izzit posible EURO/USD will bounce back to level 1.27++?
Or cont decline until break the support line at 1.2650?
Super...sounds like you may be long the EURO above 1.27

The answer to your question is YES to both sides. We will undoubtedly see 1.2650 and lower and I'm even more sure we'll see highs well above 1.27. The question you pose is not qualified with your time-horizon requirement.

Depending on NFP, we will see either or by tomorrow.
  • #7
  • Oct 5, 2006 10:49am Oct 5, 2006 10:49am
Hang in there. You will see higher than 2720.
The market is my nation. Traders, my family. Hello, brothers and sisters!
  • #8
  • Oct 5, 2006 10:51am Oct 5, 2006 10:51am
Quoting super84
Anyone can tell me why ECB raised interest rate .25% but made the EURO decline ?It's suppose strenthen and EURO/USD up,but drop more than 30-40 points?
Makes you wonder why you would waste time thinking about what the market might do doesn't it?
  • #9
  • Oct 5, 2006 11:26am Oct 5, 2006 11:26am
euro news is usually a damp squib - it's the U.S news that matters.also .25 was expected so no surprise there.
  • #10
  • Last Post: Oct 6, 2006 9:16am Oct 6, 2006 9:16am
Can you explain to me why the EUR/USD rallied 100 pips last monday without a single reason???

This was pure speculation about the interest rate decision later on the week...Proof is that it kept going down for the next 3 days, Tuesday, Wednesday & Thursday...And of course Friday, after the NFP, more down...


Thanks,

Nader
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