EUR/USD: The euro resists American inflation

KEY GRAPHIC ELEMENTS

Forex traders were impatiently awaiting the publication of US inflation figures through the CPI index. Inflation came out higher than expected, yet if the indices consolidated initially as well as the assets linked to the dollar, all caught up at the end of the session with the drop linked to the announcement of the figures. So the euro is still stable against the dollar. In addition, expectations of rate cuts have changed little, with still around two thirds of investors betting on a rate cut next March from the American central bank. Today, a new statistic could drive the trend on the foreign exchange market, namely the publication of the producer price index in the United States, published at 2:30 p.m. French time. Comments from members of the European Central Bank or the Fed have not succeeded in changing the trend either. We will therefore always remain sellers at this weekly resistance level in order to aim for a return to 1.07.

MEDIUM TERM FORECAST

Considering the key graphical factors that we have mentioned, our opinion is positive in the medium term on the Euro Dollar (EURUSD).

Our entry point is at 1.0970 USD. The price target for our bullish scenario is at 1.0700 USD. To preserve the invested capital, we advise you to position a protective stop at 1.1158 USD.

The expected profitability of this Forex strategy is 270 pips and the risk of loss is 188 pips.

DAILY DATA CHART