EURUSD: watch for inflation data
It was one of the calmer weeks on the FX market when it comes to USD movements, as there has not been too much important data which were scheduled for a release. Fed Chair Powell held a speech for the IMF audience in Washington, without too much new information, from the ones already heard after the FOMC meeting. However, he revealed that the market and Fed are viewing future increases in interest rates differently. While the market perceives that the Fed is done with further rate hikes, Fed Chair Powell noted that there is a possibility of further rate hikes in case that inflation “reaccelerates”. Treasury yields and US equities reacted to such rhetoric, while USD remained in a relatively calmer mode. At the same time, released data for Michigan Consumer Sentiment preliminary for November showed a drop to the level of 60.4, significantly down from market expectations of 63.7.
Data published for the Euro Zone during the previous week shows that the final inflation figure in Germany for October remained at 3.8%, without change from the previous post.
The eurusd was moving within a relatively short range during the previous week. Although the pair started the week at level of 1.075, it swiftly reverted to the downside, but only till support line at 1.067, which has been tested on this occasion. There has not been market strength to push the price of the pair lower from the support. The RSI continues to move above the 50 line, however, there is still no indication that the market is ready for a clear move toward the overbought side. Moving average of 50 days is still modestly diverging from MA200 counterpart, not providing an indication over the potential cross in the coming period.
The support line at 1.067 has been tested during the previous week, however, the market did not have strength to clearly test 1.08 resistance. It leaves some space for the currency pair to test this level in the week ahead, especially considering that inflation figures as well as PPI for the US for October will be published during the week.
Important news to watch during the week ahead are:
Data published for the Euro Zone during the previous week shows that the final inflation figure in Germany for October remained at 3.8%, without change from the previous post.
The eurusd was moving within a relatively short range during the previous week. Although the pair started the week at level of 1.075, it swiftly reverted to the downside, but only till support line at 1.067, which has been tested on this occasion. There has not been market strength to push the price of the pair lower from the support. The RSI continues to move above the 50 line, however, there is still no indication that the market is ready for a clear move toward the overbought side. Moving average of 50 days is still modestly diverging from MA200 counterpart, not providing an indication over the potential cross in the coming period.
The support line at 1.067 has been tested during the previous week, however, the market did not have strength to clearly test 1.08 resistance. It leaves some space for the currency pair to test this level in the week ahead, especially considering that inflation figures as well as PPI for the US for October will be published during the week.
Important news to watch during the week ahead are:
- Euro: Second estimate for the GDP Growth for Q3 for the Euro Area, ZEW Economic Sentiment Index for November for Germany, Euro Area Inflation Rate final for October;
- USD: Inflation Rate for October, PPI for October, Retail Sales for October, Building Permits preliminary for October
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