-Morgan Stanley
Amid a lack of fundamental data due to the Easter holidays, this week's main highlight for the Euro will be Mario Draghi's speech during the conference in Amsterdam. The single currency gave back earlier gains against the greenback, as investors welcomed positive data from the U.S., and were awaiting Mario Draghi to appear in public and shed light on future moves of the monetary policy. Last time he made it clear the central bank is ready to combat persistently low inflation and sluggish growth. Moreover, he noted that further appreciation in the Euro will trigger immediate monetary easing. Investors are currently betting the ECB will pull the trigger in June, however, markets are preparing for a massive selloff already now, as more than 66% of opened positions are short. The most traded currency pair is likely to find solid support at 1.3673, the low seen on April 4. The current situation looks like an old saying– the chicken and the egg– will Mario Draghi's hand be forced by investors' pressure, or traders will give up on waiting for fresh actions?
At the same time, the latest reports are sending promising signs, as consumer confidence in the 18-nation bloc rose 0.6 points on a monthly basis to –8.7 this month, outpacing market's expectations. For the overall EU the gauge of consumer mood climbed by 0.8 points to –5.8.
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