- The EUR/USD pair maintains a bullish bias as the DXY remains under pressure.
- The US inflation should bring sharp movements tomorrow.
- Only a new lower low may activate a sell-off.
The EUR/USD price ranges in the short term. The pair is trading at 1.0739 at the time of writing. It has changed little in the short term as the traders are waiting for the US inflation data before taking action.
–Are you interested in learning more about forex robots? Check our detailed guide-
The Consumer Price Index is expected to report a 0.1% drop in December versus the 0.1% growth in November. The CPI y/y could be reported at 6.5% versus 7.1% in the previous reporting period, while Core CPI may report a 0.3% growth in the last months.
The economic indicators represent high-impact events and could shake the markets tomorrow. In addition, the Unemployment Claims could bring some action as well. On Friday, the Prelim UoM Consumer Sentiment could also have a big impact.
Dollar Index price technical analysis: Rebound
The DXY is struggling to rebound after its massive drop. It has found support above 102.94. Now, the index challenges the 103.39 static resistance. DXY’s larger rebound should force the USD to dominate the currency markets. On the contrary, a new sell-off on the Dollar Index should weaken the greenback. The descending pitchfork’s lower median line (LML) is a dynamic resistance. Making a valid breakout above it may signal further growth in the short term.
EUR/USD price technical analysis: Accumulation
From the technical point of view, the EUR/USD pair could resume its growth as long as it stays above 1.0713, R1 (1.0730), 1.0736, and above the upper median line (UML). The 1.0760 immediate high represents an upside obstacle. A new higher high, a valid breakout through this level could confirm an upside continuation.
–Are you interested in learning more about South African forex brokers? Check our detailed guide-
This scenario could bring new long opportunities as well. False breakouts through this upside obstacle may announce a new sell-off. Still, only a new lower low, dropping and closing below 1.0713, activates a leg down. The pair could continue to move sideways ahead of the US inflation figures in the short term.
Looking to trade forex now? Invest at eToro!
68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money