Euro/dollar is getting away from uptrend resistance as US CPI surprises with a rise of 0.4%, higher than +0.2% that was expected. Core CPI rose by 0.2% as expected. Persistent inflation lowers the chance of QE3.
On the downside, weekly jobless claims unexpecdely rose to 428K. A figure of 410K was expected. It’s important to note that this is still within the range seen in recent months.
Another sign of weakness in the US came from the Empire State Manufacturing Index which disappointed with a drop to -8.8 points, worse than -3.9 that was expected.
US Current Account showed a slightly smaller than expected deficit: $118 billion, in comparison with $122 that was predicted.
The large amount of data makes the moves somewhat limited, especially as there’s more data coming soon.
EUR/USD is currently at 1.3790, around the minor line of 1.3788, and further away from uptrend resistance, which currently stands at 1.3812.
EUR/USD is trading in an uptrend channel throughout the week. Uptrend support was first formed, and later on, uptrend resistance became very clear. The pair has been flirting with uptrend resistance earlier in the day.
Key resistance is at 1.3838, followed by 1.3950. Support is found at 1.3788, 1.37 and 1.3630. For more on the pair, see the euro dollar forecast.
There are quite a few more US releases. The most important one ahead is the Philly Fed Index, which plunged last month to a horrible -30.7 points, and is now expected to recover, but remain negative. It’s due at 14:00 GMT.
Before that, we have industrial production and the capacity utilization rate.Get the 5 most predictable currency pairs