EUR/USD analysis: down within range, US CPI now takes center stage
EUR/USD Current price: 1.1385
The EUR/USD pair is down for a second consecutive day, having posted a daily low of 1.1370 and closing not far above it, despite the greenback also remained under pressure, ending the day mixed among the G10 bloc. The common currency got some limited intraday support on news indicating that the ECB will likely announce in its September policy meeting a plan to gradually unwind its bond-buying program starting next year, but surprisingly that was not enough to keep the pair above 1.1400, somehow anticipating buyers may have paused and that profit taking could be around the corner.
In the macroeconomic front, Germany released June inflation figures, which came in line with expectations and previous month numbers, failing to motivate investors. In the US, the producer price index for final demand rose by 0.1% in June, beating expectations of a flat reading, and by 2.0% from a year before, above the expected 1.9% but below previous 2.4%. The core readings, excluding food and energy, came slightly below expected, while weekly unemployment claims fell by less-than-expected, down to 247K from a previously revised 250K and above the expected 245K. On Friday, the US will release its final June inflation and retail sales figures, pretty much the reason of the limited action seen this Thursday.
From a technical point of view, the 4 hours chart shows that the price settled below a flat 20 SMA, whilst the Momentum indicator hovers around its mid-line and the RSI indicator turned marginally lower around 45, not enough to confirm additional slides ahead. The same chart shows that a daily ascendant trend line converges with a bullish 100 SMA around 1.1340, a strong support that once broken will open doors for a steeper decline that will turn into a bearish movement only on an extension below 1.1290.
Support levels: 1.1340 1.1290 1.1250
Resistance levels: 1.1420 1.1460 1.1490
Author
Valeria Bednarik
FXStreet
Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.
