EUR/USD analysis: back below 1.1300 as dollar strengthens
|EUR/USD Current Price: 1.1284
The EUR/USD pair fell on Wednesday and retraced completely its weekly gains, as the Dollar strengthened across the board despite weaker-than-expected US inflation data. US reported consumer price index rose 0.1% in May, in line with expectations, while CPI grew 1.8% YoY below the 1.9% of consensus. Core CPI readings also came a touch softer than anticipated, scoring 0.1% MoM versus 0.2% expected, and 2.0% YoY versus 2.1% forecasted. However, data barely bothered the greenback, as a rate cut by the Fed seems mostly priced in by now. During the New York session, President Trump made his daily comment and threatened with imposing tariffs on China and Mexico if no deals are reached.
EUR/USD made an upside attempt but was once again rejected from the top of its recent range, with today’s peak at 1.1343. The pair broke below the 20-SMA in 4-hour charts and slid below the 1.13 mark. The technical picture has turned negative in the short-term charts, with the Momentum and the RSI indicators both pointing south below their midlines, with the price below the 23.6% Fibo retracement of the 1.1107/1.1347 rally. The decline could easily extend to next Fibo level at 1.1255. However, in the daily charts, indicators are correcting from overbought conditions but remain positive, suggesting the pullback should be limited. On the upside, the pair needs a clear break above 1.1347 to test the 200-day SMA around 1.1365 first, en route to 1.1400.
Support levels: 1.1270 1.1255 1.1190
Resistance levels: 1.1350 1.1365 1.1400
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