EUR/USD Rate Accelerates Decline Following European Inflation News
According to the Eurostat data released today:
Core CPI Flash Estimate (YoY): actual = 2.7%, expected = 2.7%, previous = 2.8%;
CPI Flash Estimate (YoY): actual = 1.8%, expected = 1.8%, previous = 2.2%.
This news, coupled with yesterdays statements from the Fed Chair, led to the EUR/USD rate dropping by over 1% from yesterdays high.
Could the downward trend continue?
Technical analysis of the EUR/USD chart shows that:
In the second half of September, bullish sentiment dominated, resulting in the formation of an ascending channel (shown in blue). However, near the key resistance at 1.1200 (drawn from the August peak), the bullish momentum faded, and the price entered a range between 1.1200 and 1.1122.
The bearish momentum that started from yesterdays peak (B) is developing strongly. The price has broken both the lower boundary of the 1.1122 range and the lower boundary of the blue channel. Moreover, it has dropped below 1.1108, approximately the 50% retracement of the AB rise.
This suggests that the first day of October could see bulls losing much of the gains from the previous month. A glimmer of hope for them may lie in the psychological support at 1.1080.
Read more: https://fxopen.com/blog/en/oa-eur-usd-rate-accelerates-decline-following-european-inflation-news/
Text source: Forex Trading Blog
