Who’s considering of buying and selling the U.S. CPI launch this week?
Right here’s a easy EUR/USD consolidation setup to maintain in your radar.
As you may see from the hourly chart beneath, the pair shaped decrease highs and located assist across the 1.0945 stage to create a descending triangle.
EUR/USD 1-hour Foreign exchange Chart by TV
Worth simply bounced off the triangle assist close to S1 (1.0930) and is now setting its sights again on the resistance near the pivot level (1.0990) and 1.1000 main psychological deal with.
Is the ceiling more likely to maintain?
Technical indicators are suggesting so, because the 100 SMA is beneath the 200 SMA whereas Stochastic seems to be prepared to move down from the overbought area, reflecting the presence of bearish vibes.
If that’s the case, EUR/USD simply may slip again to the underside of the triangle once more or maybe try a bearish breakdown to S2 (1.0860).
Alternatively, a transfer previous the triangle prime might set off a climb to the following upside limitations at R1 (1.1070) and even R2 (1.1120).
There aren’t any main catalysts within the upcoming buying and selling classes, so there’s a very good likelihood this pair might keep in consolidation forward of the U.S. CPI launch on Thursday.
Quantity crunchers are projecting a slight pickup within the annual CPI studying from 3.0% to three.3% which simply could be sufficient to revive Fed tightening bets as soon as extra. If that’s the case, the Dollar might recoup its post-NFP losses whereas additionally banking on risk-off flows.
In the meantime, there aren’t any main studies due from the eurozone, so the shared forex may very well be a viable counter forex when buying and selling U.S. information releases. Don’t overlook that the ECB simply shifted to a much less hawkish stance not too long ago, too!
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