“¢ EZ headline CPI expected to climb 1.9% y/y and core CPI by 1.1% y/y in May.
“¢ Inflation print beats estimates but fails to provide any fresh bullish impetus.
The EUR/USD pair built on overnight strong recovery move, albeit failed to extend the momentum post-EZ CPI print.
After a brief Asian session consolidation phase, the pair regained traction and surged through the 1.1700 handle, hitting a fresh weekly high level of 1.1724 amid receding anxiety over the political situation in Italy.
The up-move, however, failed to accelerate further despite hotter than anticipated flash EZ inflation figures, coming in to show that the headline CPI is expected to climb 1.9% y/y. Meanwhile,
The core reading also better expectations, rising 1.1% on a yearly basis, and eased ECB policymakers’ concerns ahead of the June 14 meeting but did little to provide any fresh bullish impetus.
Looking at the technical picture, the pair already seems to have cleared an important barrier marked by a short-term descending trend-channel and hence, seems more likely to continue with its recovery momentum.
Technical levels to watch
Any subsequent up-move beyond session tops now seems to confront resistance near the 1.1765 region, above which the pair is likely to aim towards reclaiming the 1.1800 handle.
On the flip side, immediate support is now pegged near the 1.1660 level, which if broken might prompt some additional weakness and drag the pair back towards the 1.1600 handle.
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