EURUSD showed a minor pullback post-US CPI. It hits a high of 1.06520 at the time of writing and is currently trading around 1.06020.
The U.S. Consumer Price Index (CPI) data for October 2024 reveals several key points. The annual headline CPI rose to 2.6%, up from 2.4% in September, with a month-over-month increase of +0.2%, aligned with expectations. The unrounded month-over-month figure was reported at 0.2441%, compared to 0.1799% the previous month. The core CPI, which excludes food and energy prices, remained steady at 3.3% year-over-year, consistent with the prior month. This data indicates ongoing inflationary pressures in the economy, which may influence the Federal Reserve's monetary policy decisions. The stable core CPI signals that underlying inflation is still a concern. Overall, these figures are likely to impact market expectations regarding future interest rate adjustments as the Fed balances inflation control with economic growth support.
Technical Analysis Overview
The pair remained below both short-term (34 and 55-4H EMA) and long-term (200-4H MA) moving averages.
Resistance Levels: Near-term resistance is at 1.0660. A breakout above this could push the pair towards targets at 1.070/1.0760/$1.0835, and possibly 1.0900. Major bullish momentum is expected only if prices surpass 1.1000, which would open the door to 1.1070 and 1.1150.
Support Levels: Immediate support is at 1.06000. A drop below this could lead to further declines to 1.0560/ 1.0500.
Indicator Insights (4-Hour Chart): The Commodity Channel Index (CCI) indicates a bearish trend, while the Average Directional Movement Index (ADX) suggests a bearish outlook.
Trading Strategy
Given the weak sentiment in technical indicators, a sensible strategy would be to sell on rallies around the 1.0660 mark, with a stop-loss at 1.0700 and a target price of 1.0500 for potential gains.
