EUR/USD has been on a tear today challenging the long term resistance levels at the 1.1300 figure. The rally has been triggered by hawkish comments from ECB Chief Mario Draghi who sent euro soaring in early morning European trade when he indicated that ECB policy may soon move to neutral from accommodative and stated that the recovery in the Eurozone is in full bloom.

Speaking at an ECB Forum on banking Mr. Draghi painted a generally upbeat picture of economic conditions in the Eurozone noting that the central bank sees EZ growth above trend and that all signs are now pointing to a strengthening and broadening recovery in the region.

Mr. Draghi, however, added that inflation remains muted and that it not yet durable or self-sustaining. Still, he affirmed that policy is likely to change to a more neutral stance in the near future, suggesting that ECB may be making preparations for a taper.

All of this provides a very bullish foundation under the pair and could propel it towards the 1.1500 level over the near term horizon especially if EZ growth continues to accelerate while US growth remains sluggish.