ECB, what will/can it do to reverse the EURUSD trend?

March has been an upward month for the EURUSD, ~750 pips and counting:



Nice climb, so what?

750 is nothing wild, if you want wild check out the yen. What makes this a wild a climb is that at no point in the last decades has more been thrown at the EUR to bring it down, and even so, it went up 750 pips (!) Now that, is wild!!

This climb comes after the ECB reiterated it's commitment to QE by word and action...yes, about a month ago. This was also on the heels of an already royal package. If the ECB sticks to its "whatever it takes" approach, we could see QE talk intensify (in whatever shape or form it will eventually materialize in) as inflation and wage increases remain elusive. Keep in mind that a strong euro does not favor inflation targets.


Possible measure:
At the moment the ECB QE program has been discussed until 2017. I would guess the next step the ECB could take would be announcing an extension -and perhaps an expansion- of the QE/asset-purchase program well into 2018-2019. This could provide a very attractive long term investment opportunity for EUR based equities given it creates an artificial "safety net" effect. Presumably this investment "in numbers" will eventually find its way into the job market, loans, development in the EUR area, and thus...sparking that long awaited inflation increase...followed by wages (or is that asking too much?)

Possible outcome:
Puts a lid on how far the EUR can appreciate
Creates immense downward pressure on the pair, this with some help from the fed, could lead to parity talk again this year.

Anyone with ideas on what the ECB will do to reverse the current EURUSD surge?

US interest rates on hold. No changes coming from the US side:

EURUSD M1



ECB will have their hands full lifting inflation.

EURUSD D1:

the ecb don't really care about eurusd, draghi have said it many times.

what they care about is the economy, inflation, and if we want a chart, the stock market (european equities, dax, cac, eustoxx etc.)

of course eurusd is affected by ecb policies but it's just a secondary effect.


tldr: central banks = stock market

You say tomato, I say tomato

Sure, the ECB wants to control inflation, but I think we can agree that at this stage, both require the same measures...that's why it's implicitly referred that "the ECB will affect the forex market"....not because it's its intention, but because it's action to curb inflation will i-n-e-v-i-t-a-b-l-y affect the EUR.