EUR/USD Current price: 1.1212
- EU inflation revised modestly higher in June, still far below the ECB’s target.
- US housing-related data missed big, dollar buyers ignore it.
- EUR/USD could re-test yearly lows once below 1.1181.
The EUR/USD pair is trading a few pips above the 1.1200 level, having consolidated around the figure since the day started. The dollar gave back some of the ground gained Tuesday, but in the case of the common currency, speculative interest can’t find a reason to buy it, despite better-than-expected CPI. According to the official release, inflation in the Union rose by 0.2% MoM and by 1.3% YoY, slightly above the market’s forecasts, while the core readings also ticked marginally higher. However, inflation is no game-changer for the ECB, still far below the central bank’s target.
US data just released was disappointing, as Housing Starts fell by 0.9% MoM in June against the expected 1.9% advance. Building Permits in the same period fell by 6.1%, far below the forecast of a 1.6% advance. Meanwhile, Wall Street is easing ahead of the opening, despite some robust earnings reports already published. Big names will come out through the session and is yet to be seen if those will be enough to offset trade-related concerns.
EUR/USD short-term technical outlook
The EUR/USD pair retains the bearish stance in the short-term according to what the 4 hours chart shows, developing not far above July’s low of 1.1181. The 20 SMA in the mentioned chart gained downward traction above the current level, now converging with a Fibonacci resistance around 1.1245, and below the larger ones. Technical indicators have lost their strength downward, but remain near daily lows and oversold readings. The pair would need to break below the mentioned monthly low to gain downward traction, with the next probable target being the yearly low at 1.1106.
Support levels: 1.1180 1.1150 1.1110
Resistance levels: 1.1245 1.1280 1.1310
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