Expectations Strengthen for Second ECB Rate Hike

Strengthening expectations of a second rate hike by the European Central Bank (ECB) stand out as a supportive factor for the euro. However, the current technical outlook is weak, with the price trading below the SMA20 and SMA50, and the RSI approaching oversold territory at 30.7. The MACD is in negative territory and below its signal line, indicating downward short-term momentum. Despite the positive news flow, the weakness in technical indicators and the decline over the last 24 hours suggest that upside movement may remain limited. Therefore, a slight recovery is possible in the short term, but it is premature to expect a strong rally.

Expectations of an ECB rate hike could strengthen the euro and create downward pressure on the EURTRY parity. Technical indicators also support this view, with the RSI at 38 in the sell zone and the MACD trading negatively below its signal line. The price is trading below the SMA20 and SMA50, indicating short-term weakness. However, the impact may remain limited due to local dynamics and volatility surrounding the Turkish lira. Therefore, the direction is downward, but a strong decline should not be expected.

The DAX index has declined more than 2% in the last 24 hours, falling to 25,957. While the RSI at 30.9 approaches oversold territory, the MACD remains in negative territory and below its signal line, indicating that selling pressure persists. The price is trading below both the 20-day and 50-day moving averages. Strengthening expectations of a second interest rate hike by the ECB, especially combined with growth concerns, could exert additional pressure on equity markets. In the short term, the technical outlook is weak and the news flow supports this direction, but some corrective buying may emerge due to oversold conditions.

The strengthening expectation of a second rate hike by the European Central Bank (ECB) could exert pressure on equity markets. The CAC index is already in a short-term downtrend, with technical indicators signaling weakness. The RSI is approaching oversold territory at 34, while the MACD is negative and below its signal line. The price is trading below both the 20-day and 50-day moving averages, indicating negative momentum. Given the combination of news flow and technical outlook, the index is likely to continue its downward trend in the coming days.