EUR/USD to slump again after ECB decision?

The EUR/USD plunged after the hotter-than-expected CPI, as traders reevaluated the odds of a Fed rate cut in June.

EUR/USD has now perhaps broken out of the range of its significant Simple Moving Averages.

Now we might get another pushdown in the lead up to or after the ECB interest rate decision tomorrow. The April 2 swing low of 1.07245 may prove pivotal. The previous session's decline was the biggest single-day decline since March 2023, so it will be interesting to see if this bearishness has been exhausted.

The European Central Bank (ECB) is expected to keep rates unchanged but perhaps point towards the start of its own rate cutting cycle in June. ECB officials have already begun discussing this timeline, so tomorrow’s announcement might lack the bite of a CPI print.

Instead, traders could look for clues on future ECB policy during Christine Lagarde’s press conference following the rate decision.