EUR/USD advances towards 1.0800 with the US CPI data on focus

• The Euro trims losses as the US Dollar pulls back ahead of the US CPI release
• US Inflation and the Fed decision will set the Dollar’s near-term direction.
• EUR/USD’s immediate trend remains bearish while below 1.0815.

The Euro is moving with a moderately positive tone during the European morning trade, reaching intra-day highs near 1.0800 as the Dollar loses footing ahead of the release of US CPI figures.

US CPI and the Fed will set the Dollar’s direction

Later today, the US Bureau of Labor Statistics is expected to announce that US inflation edged down to 3.!% in the last twelve months to November and that the core CPI remained steady at 4%.

These figures will be analyzed with particular detail today, with all eyes on Wednesday’s Federal Reserve’s monetary policy decision. Investors’ speculation about the timing for a Fed pivot is the main driver behind FX markets and, in that context, any surprise in the inflation trends might have a significant impact on US Dollar crosses.

EUR/USD Technical analysis

The pair’s corrective reversal from late November highs has found support on the 50% Fibonacci retracement of the October - November rally, at 1.0730.

The near-term bias remains negative with 1.0815, where previous highs meet the 4h 50 SMA, likely to offer a significant resistance. Above here, 1.0880 will come next.

Supports are at the mentioned 1.0730 and early November lows at 1.0660.

EUR/USD technical levels to watch