Global macro overview for 17/10/2016:

The most anticipated event of the week will be the ECB interest rate decision and asset purchase target this Thursday at 11:45am GMT. Moreover, the ECB press conference should be interesting to watch as ECB President Mario Draghi might face the question regarding the future of quantitative easing and a possible timing of tapering the program. Most of economists agree that Draghi will have to extend the QE program even longer mainly due to a lack progress in inflation increase: consumer prices are barely rising. The other side of the coin is a rather fragile economic recovery, that mostly depends on Germany. In conclusion, a highly anticipated economic event which might increase the volatility if the ECB will act differently than market participants expect.

Let's now take a look at the EUR/USD technical picture in 4H time frame. The price has dropped to the level of 1.0965, almost touching the important support at the level of 1.0958. Bears seem to be in full control over this market, but the growing bullish divergence between the price and momentum oscillator might suggest a temporary correction. The next resistance is seen at the level of 1.1043.