EUR/USD Analysis: back to bearish on upbeat US inflation
|EUR/USD Current price: 1.1297
- EU Industrial Production fell by more than expected in December.
- US inflation remained at 'rate hike' levels in January.
Having peaked at 1.1341 the EUR/USD pair is down daily basis, as the greenback recovered its shine following softer-than-expected EU and UK data. The EU reported December Industrial Production, which resulted worse than expected, falling by 0.9% MoM and by 4.2% YoY. The greenback got another boost from headlines indicating that, according to people familiar with the matter, US President Trump is willing to sign the latest Congressional deal to keep the government funded and avoid another shutdown.
The EUR/USD pair was flirting with the 1.1300 figure, when the US released January inflation data, which resulted better-than-expected, backing some additional USD gains. According to the official report, inflation remained unchanged monthly basis, but rose 1.6% YoY, beating estimates of 1.5%. The core yearly CPI, which excludes volatile food and energy prices, came in at 2.2%, above the market's forecast of 2.1%.
The pair broke below the 1.1300 figure ahead of Wall Street's opening, with equities poised to extend their weekly advance amid the positive momentum of their overseas counterparts. The ongoing decline confirms that yesterday's gains were a mere correction, as the pair stalled around the 38.2% retracement of the 1.1488/1.1257 slide at 1.1345, now trading also below the 23.6% retracement of the same slump at 1.1310. According to the 4 hours chart, the bearish case is strong, as the price broke below a bearish 20 SMA, while technical indicators turned sharply lower, dipping into negative ground after briefly hovering in positive levels. The low of the range is the immediate support ahead of 1.1215, 2018 low. The mentioned Fibonacci retracements will continue to attract selling interest in the case of upward spikes.
Support levels: 1.1260 1.1215 1.1180
Resistance levels: 1.1310 1.1345 1.1380
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.