The Dollar Falls Following US Inflation Data Release
Weaker-than-expected US Consumer Price Index (CPI) data released yesterday triggered a downward correction in the US dollar. The USD/JPY pair lost more than 150 points in just a couple of hours, USD sellers in USD/CAD managed to push the price below 1.4400, and European currencies partially recovered earlier-formed reversal patterns for buying.
USD/JPY
On the daily timeframe, the USD/JPY pair has broken out of a three-week consolidation range of 158.40156.20. If sellers manage to secure the price below the lower boundary of this range, further downward movement towards 154.50154.00 is possible. A resumption of the upward trend may occur if the price returns above 156.20.
Events likely to influence USD/JPY pricing include:
- 16:30 (GMT+2): US Core Retail Sales Index
- 16:30 (GMT+2): Initial Jobless Claims in the US
- 16:30 (GMT+2): Philadelphia Fed Manufacturing Index (US)
USD/CAD
A retest of the critical resistance level at 1.4450 proved unsuccessful for USD/CAD buyers. The rejection from this level resulted in a 120-point decline, leading the pair back to the 1.4300 zone. Technical analysis of USD/CAD suggests a sideways movement. Currently, the pair could decline to the 1.43001.4280 area. If the pair rebounds from this zone, price strengthening towards 1.44501.4400 is possible.
Events that may trigger a breakout from the USD/CAD flat range include:
- 16:15 (GMT+2): Canadian Housing Starts
- 20:30 (GMT+2): Speech by Bank of Canada Deputy Governor Gravel
- Tomorrow at 16:30 (GMT+2): Foreign Investment in Canadian Securities
Read more: https://fxopen.com/blog/en/ru-the-dollar-falls-following-us-inflation-data-release/
Text source: Forex Trading Blog
