EUR/USD analysis: steady at lows ahead of Wall Street's opening
|EUR/USD Current price: 1.1782
- US data disappointed, but the dollar holds on to gains against European rivals.
- EU inflation remains subdued, maintains the ECB in the easing path.
The common currency is among the worst performers against the greenback this Wednesday, extending its decline to 1.1766 during the London session. There was no particular catalyst behind the decline but persistent dollar's strength, although in-line with expectations EU inflation didn't help. The German CPI was of 0.0% in April when compared to the previous month, when it also stood unchanged. Yearly basis, inflation remained steady at 1.6%. For the EU, core readings were quite soft, as core inflation was up 0.2% vs. previous 1.4% MoM and steady at 0.7% YoY, also matching market's forecast.
US data surprised to the downside, as Housing Starts plunged in April by 3.7%, although Building Permits were better-than-expected down by "just" 1.8% vs. market's expected -2.3%. Still pending or release are Industrial Production and Capacity Utilization for April.
The bad news did little against the dollar which holds near its daily highs against the EUR. The short-term picture is still bearish, although in the 4 hours chart, technical indicators are losing their bearish strength after reaching oversold territory, and some consolidation or even a short-lived upward correction could be possible ahead of the next directional move. In the mentioned chart the pair remains well below all of its moving averages, with the closest being the 20 SMA at 1.1900.
Support levels: 1.1765 1.1740 1.1710
Resistance levels: 1.1810 1.1840 1.1880
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