The EUR/USD has once again started to look bearish. It’s hard to see a big rally into the highs, seeing as the USD has found a base. We are looking to short at 1.2450 with a stop loss at 1.2600 and a profit target of 1.2200.
EUR/USD 240 min Chart - EUR/USD is Sliding Lower
CPI the Focus for Traders This Week
The EUR/USD has been doing it’s best to test the highs, but last week saw some renewed strength from the USD. The Greenback has been trending down and that has helped lift the shared currency.
Last week all that changed and the USD finally managed to find a bit of a base. Then on Friday markets got a spark when we saw a big beat in the headline non-farm payroll number out of the US. The number of jobs created last month was higher than anticipated and markets liked it. The dollar held strong for the most part, but that news might see some follow through in Monday trade.
This week inflation takes center stage. We have CPI data out of both the US and Eurozone. Both Central Banks have been nervous about the amount of inflation they are seeing at the moment.
The US wants to raise rates four times this year. While the Eurozone is looking at how it can wind back the monetary stimulus. The issue for both has been that inflation numbers continue to lag.
If we get a strong number from either economy, we are likely going to see that particular currency jump to the upside.
Technical Analysis - The Key Levels
1.2200 continues to be the most important technical level in the EUR/USD. If we fall below that point then we re enter bear territory. Which will make it tough to see a rally in the short-term.
Meanwhile, we haven’t been able to break above 1.2500 with any real vigor. So for now that is our roof. I am looking at a test and break of support, more so than a move through the highs.
EUR/USD - Key Levels
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