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EUR/USD expects US CPI firm above 1.0740

  • The US inflation data is coming, which is expected to generate great movement.
  • The dollar could accelerate its fall or trigger a strong correction.
  • EUR/USD is trading in a firm uptrend above 1.0700, the highest since June.

The EUR/USD is trading around 1.0760, in the zone of maximums since June, before the US inflation figures for December are known, which can bring a lot of movement in the market.

The Wednesday the pair reached the highest in months at 1.0776 and then had a modest correction to 1.0730/35. On Thursday the lows reached 1.0740, ratifying the pair’s short-term bullish tone, supported by the drop in the dollar and a firmer euro in the market. The latter partly thanks to comments from European Central Bank officials in favor of further interest rate hikes.

The weakness of the dollar in recent weeks before the rally in Treasury bonds, was behind the expectation of a Federal Reserve becoming less harsh. The inflation data that will be released at 13:30 GMT will be important for these expectations and therefore can generate a lot of noise in the market.

The market consensus is that the Consumer’s price index (CPI) has remained unchanged in December and that the annual rate goes from 7.1% to 6.5%. Core CPI is expected to rise 0.3% with the annual rate declining from 6.0% to 5.7%.

The EUR/USD reaches the key data with a firm upward trend, supported by the weakness of the dollar and in a context of optimism in the stock markets. The rises for the moment have found resistance in the 1.0770 area, which if it yields would put 1.0800 on the radar. In the opposite direction, first support appears at 1.0710/20 and below at 1.0660.

technical levels

EUR/USD

Panorama
Last Price Today 1.0762
Today’s Daily Change 0.0008
Today’s Daily Change % 0.07
Today’s Daily Open 1.0754
Trends
20 Daily SMA 1.0635
SMA of 50 Daily 1.0463
SMA of 100 Daily 1.0173
SMA of 200 Daily 1.0311
levels
Previous Daily High 1.0776
Minimum Previous Daily 1.0726
Previous Weekly High 1,071
Previous Weekly Minimum 1.0483
Maximum Prior Monthly 1.0736
Minimum Prior Monthly 1.0393
Daily Fibonacci 38.2% 1.0757
Daily Fibonacci 61.8% 1.0745
Daily Pivot Point S1 1.0728
Daily Pivot Point S2 1.0701
Daily Pivot Point S3 1.0677
Daily Pivot Point R1 1.0778
Daily Pivot Point R2 1.0803
Daily Pivot Point R3 1.0829

Source: Fx Street

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