- EUR/USD is pressured in the opening session as the US dollar remains firm, with eye son US CPI.
- A risk-off environment could be a weight for the euro at the start of the week.
EUR/USD is under pressure in the opening session this week, with China returning from holiday's and digesting another bumpy ride on Wall Street on Friday due to upbeat economic data in the form of Nonfarm Payrolls surprises. The US dollar, as measured by the DXY index, is trading at 95.555 and near flat on the day but the euro is heavy and losing some 0.1% at the time of writing.
The greenback is consolidating Friday's price action where it rallied from a two-week low after the Nonfarm Payrolls data showed that the world's largest economy had created far more jobs than expected. The data showed that Payrolls grew 467,000 jobs last month and data for December was revised higher to show 510,000 jobs created instead of the previously reported 199,000. Reuters had forecast 150,000 jobs added in January while estimates ranged from a decrease of 400,000 to a gain of 385,000 jobs.
The case for Federal Reserve rate hikes was cemented This led to gold prices falling under pressure from a firmer dollar and higher US Treasury yields.
Looking ahead, analysts at ANZ Bank commented in a note and explained that ''January Consumer Price Index data this week are expected to show headline and core inflation remain elevated. Any sizable upward surprise would add to the case for the Fed starting off more aggressively.''
''Owing to very high energy prices and a broadening in underlying inflation pressures, the risks lie to the upside of the market’s 7.3% YoY forecast,'' analysts at TD Securities explained. ''Based on the inflation prints in other countries, a number in excess of 7.5% YoY is feasible.''
Meanwhile, there is a focus on Russian headlines from the weekend that could weigh on risk appetite and the euro as a consequence:
EUR/USD technical analysis
Meanwhile, EUR/USD is attempting to first in the lastest hour which leaves the neckline of the H1 M-formation vulnerable to a test. The bears will not be far behind, however, and eyes are on a break below 1.1410 for a run to 1.1330 for the sessions ahead.
EUR/USD H1 chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.