EUR/USD refreshes session tops post-German CPI/ADP report

   “¢   Flash German CPI betters forecast and adds to today’s upbeat retail sales data.
   “¢   ADP report weighs on already weaker USD and provides an additional boost.

The EUR/USD pair built on its solid rebound and refreshed session tops, closer to mid-1.1600s following the release of German CPI/ADP report.  

The pair’s ongoing strong recovery move from the vicinity of the key 1.15 psychological mark, or 10-month lows set in the previous session, was further supported by today’s upbeat release of German retail sales data for April.  

The up-move got an additional boost following the release of hotter than expected flash German inflation figures, coming in to show that the headline CPI is expected to climb 0.5% m/m in May and 2.2% on a yearly basis.  

Meanwhile, weaker than expected private sector employment report from the US kept exerting downward pressure on the already weaker US Dollar and further collaborated to the pair’s strong bid tone.  

The latest ADP report on nonfarm employment showed private-sector employers added 178K new jobs in May, which was well below previous month’s reading of 204K and also weaker than 190K expected.

It, however, remains to be seen if the pair is able to build on its solid rebound or the up-move is looked upon as an opportunity to initiate some fresh bearish positions amid political uncertainty in Italy and Spain.  

Today’s US economic docket also features the release of preliminary (second estimate) US Q1 GDP growth figures, which if surprises on the upside might help revive the USD demand.  

Technical outlook

Yohay Elam, FXStreet’s own Analyst writes: “On the upside, 1.1648 was the closing level on May 25th. It is followed by 1.1725 which capped the pair on May 28th and further up, the May 9th low of 1.1822 awaits.”

“The 1.1550 level was support in November and remains relevant. 1.1510 is the current 2018 trough and the lowest in 10 months. 1.1480 is next down the line,” he further added.