On Wednesday, the UK’s CPI came in at 2.2%, slightly below the 2.3% forecast, while the Core CPI dropped to 3.3%, missing expectations of 3.4%.
The EUR/USD showed little movement following France’s Final CPI, which held steady at 0.2%, aligning with forecasts.
The Dollar Index remained resilient as inflation data confirmed steady U.S. economic conditions, holding at 3.0% year-on-year as expected.
Looking ahead, the GBP/USD pair might see movement with the UK’s House Price Index (HPI) expected to rise by 2.6% compared to the previous 2.2%.
The EUR/USD could react to the Eurozone’s GDP and Industrial Production data; GDP is forecasted to remain stable at 0.3%, while Industrial Production is expected to improve slightly.
In the U.S., the Dollar Index could be influenced by upcoming Core CPI data, which is projected at 0.2%, indicating a potential shift in inflation trends.
It’s now struggling to rise above the 23.6% Fibonacci retracement level, which is acting as resistance. The key pivot point at $102.703 is crucial; staying below it suggests further downside potential.
Immediate support is at $102.166, with additional levels at $101.777 and $101.429. If the index breaks above $102.703, we could see a shift back to a bullish bias.
EUR/USD Technical Forecast
The EUR/USD is trading at $1.09932, down 0.02%, but the outlook remains bullish. On the 4-hour chart, the pair has formed a “three white soldiers” pattern, a sign of strong upward momentum that was initiated above the $1.09135 support level.
This support is reinforced by an upward trend line, and the bullish bias is further supported by the 50 EMA at $1.09228 and the 200 EMA at $1.08670, both indicating a buying trend.
The immediate resistance to watch is at $1.10094, which could limit the upside. However, as long as the pair stays above the $1.09722 pivot point, the bullish trend remains intact.
Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.
