EUR/USD depressed near a fresh weekly low at 1.2065
EUR/USD lost the 1.2100 mark with US inflation data, holding near its daily lows as demand for high-yielding assets receded. The greenback has room to continue rallying.
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The EUR/USD pair is trading in the 1.2090 price zone after posting a weekly low of 1.2071 with the news. The near-term picture is bearish, as the 4-hour chart shows that technical indicators accelerated north well into negative levels, without signs of giving up. The pair bounced from a mildly bullish 100 SMA but remains well below the 20 SMA, which lost its bullish strength. Further declines are to be expected on a break below the mentioned daily low.
Support levels: 1.2070 1.2025 1.1980
Resistance levels: 1.2110 1.2150 1.2190
The EUR/USD pair fell within range through the first half of the day, as the dollar’s selling paused ahead of the release of US inflation data. The EUR/USD pair traded around 1.2120 ahead of the event, plummeting afterwards as the US annual Consumer Price Index hit 4.2%, higher than the 3.6% expected. The core reading jumped to 3%, also surpassing expectations. Stocks are under pressure, and government bond yields higher, as speculative interest prices in higher chances of monetary policy tightening.
Earlier in the day, Germany published April inflation figures, which showed that the annual CPI was up 2% as expected. Fed’s Vice-chair Clarida will shorty offer a speech and may reinforce the Fed’s stance of being tolerant with inflation upticks.
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