Ichimoku analysis (4-hour chart)
Tenken-Sen- 1.06065
Kijun-Sen- 1.06407
EURUSD showed a minor sell-off despite weak US GDP data. The economy expanded at an annual pace of 2.7%, slightly lower compared to an estimate of 2.9%. The report said that core inflation surged to 4.3% in the fourth quarter vs. the forecast of 3.9%. It hits a low of 1.05885 and is currently trading around 1.05917.
The number of people who have filed for unemployment benefits dropped by 3000 to 192000 for the week ended 18 Feb, the lowest level in 3 weeks.
Major economic data:
US Core PCE index
New home sales
According to the CME Fed watch tool, the probability of a 50 bpbs rate hike in Mar jumped to 28% from 15.1% a week ago.
The US 10-year yield lost its shine after less than forecast US GDP data. The US 10 and 2-year spread widened to -81 basis points from -73% bpbs.
Technical:
The pair is trading below short-term 21 EMA above 55 EMA, and long-term (200-EMA) in the 4-hour chart. Any break below 1.0580 confirms intraday bearishness; a dip to 1.05001.0435 is possible. The near-term resistance is around 1.0620. The breach above will push the pair to 1.0660/1.0700/1.08000/1.08850.
Indicator (4-hour chart)
CCI – Bearish
Directional movement index – Neutral
It is good to sell on rallies around 1.0628-30 with SL around 1.0670 for a TP of 1.05000.
