After marking a three-week low at 1.0723 last Friday in the face of the stronger-than-expected NFP report, the EUR/USD pair stabilized yesterday, and posts slight gains this Tuesday morning, as several key events promise to liven up forex trading over the coming days.
In fact, we will be waiting for the American CPI data for the month of November this Tuesday, while tomorrow will be the opportunity of the Fed meeting.
Regarding the CPI expected today, note that this is a second estimate, and that the consensus forecasts an upward revision in data monthly “core”, at 0.3% against 0.2%. The core annual CPI is expected to remain unchanged at 4%, and the general annual CPI is expected at 3.1% compared to 3.2% previously.
Regarding the Fed meeting tomorrow evening, a status quo is anticipated with almost certainty. However, the chances of a rate cut for the first quarter of 2024 are uncertain, and the details of the Fed's speech and Jerome Powell's press conference could provide clues to clarify this.
Faced with a higher-than-expected CPI and a hawkish Fed, we should expect to see the dollar strengthen, and therefore EUR/USD fall. Conversely, inflation below consensus and indications from the Fed in favor of imminent rate cuts should help the Euro Dollar to progress.
From a graphical point of view, we still find bullish arguments on the daily chart.
However, we will recall that the currency pair sent a bearish signal last week by breaking below the 200-day moving average. On the other hand, the 100-day MA currently seems to play a supporting role.
Below 1.07, we can consider that the trend of the EUR/USD has turned downward, with in this case 1.06 for first objective. On the upside, the threshold of 1.08 and the 200-day MA at 1.0823 are the first obstacles.
Is EUR/USD preparing for a rebound? Everything will depend on US inflation and the Fed 1