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  • The EUR/USD pair maintains a bullish bias as long as it stays above the upper median line.
  • The US CPI and Core CPI could shake the markets.
  • The current retreat could bring us new longs.

The EUR/USD price rallied in the short term as the US ISM Services PMI hit the USD. Now, the pair is trading at 1.0728 at the time of writing, below yesterday’s high of 1.0760.

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After its strong growth, a temporary retreat can be expected. Fundamentally, the German Industrial Production and Eurozone Unemployment Rate met expectations yesterday. On the other hand, the US Consumer Credit came in at 28.0B above the 25.0B expected.

Today, the Fed Chair Powell Speaks represents a high-impact event. The bias is bullish, so further growth is in the cards. The Final Wholesale Inventories, NFIB Small Business Index and the IBD/TIPP Economic Optimism indicators will also be released.

Still, the currency pair could change ahead of the US inflation data in the short term. The US will release the Consumer Price Index and the Core CPI data on Thursday. Lower inflation reported in December could weaken the greenback as the Federal Reserve could deliver only a 25-bps hike in the next monetary policy meeting.

On the contrary, higher inflation should force the FED to deliver 50 bps again. Furthermore, the Prelim UoM Consumer Sentiment will be released on Friday and represents a high-impact indicator.

EUR/USD price technical analysis: Buyers’ traction

EUR/USD price

As you can see on the hourly chart, the price ignored the upper median line (UML) and the 1.0713 upside obstacles. Now it tries to take out the 1.0736 static resistance as well.

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The bias remains bullish as long as it stays above the upper median line (UML). Technically, the rate tries to accumulate more bullish energy before jumping higher. Stabilizing above the R1 (1.0730) could signal further bullishness.

The current retreat and consolidation could bring us new longs. Only dropping and stabilizing below 1.0713 and under the upper median line (UML) could invalidate the upside scenario and could announce a downside movement.

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