Daily wrap up – 26 October

Today, the markets have seen a remarkable move, especially following the European Central Bank's decisions to record the worst trading day against the US dollar for nearly a month as policymakers decided to extend the bond purchase program until 2018 as the size of the monetary stimulus is reduced.
The EURUSD moved strongly from its daily high of 1.1836 to hit its lowest level since August 16 at 1.1655 after rebounding from a bearish downtrend line since the broken neckline of the head and shoulders pattern over the 4-hour time frame. A strong support area on the daily time frame which represents the neckline of a new head and shoulders pattern is testing currently, if completed may target 1.1320 / 1.1280 levels.
As expected, the European Central Bank cut its purchases of assets to 30 billion euros a month instead of 60 billion euros from January 2018 to September 2018. ECB President Mario Draghi expressed optimism about the economic growth of the euro area during the press conference that followed but remained cautious about weak inflation in the region.
On the other hand, the leader of the province of Catalonia today called for snap elections in response to pressure from the Spanish government, which is waiting for the Senate meeting tomorrow to decide the implementation of direct rule over the territory.
On the other hand, the optimistic US dollar is benefiting from the approaching tax rebates Trump promised during his election campaign, and Trump will choose a new Fed chairman to raise interest rates faster than current.
Currently, the dollar index has exceeded the 93.95 level, which represents the neckline of the inverted head and shoulders pattern. If prices stabilized higher current levels, the index is expected to reach 96.50 / 97.