Forex News: Bearish Pressure Mounts, Eurozone CPI Eyed for Next Move
Forex News: The pair came under pressure Friday after failing to break above the 50 period Exponential Moving Average and finished the week in negative territory. The US Dollar has now erased all losses incurred after the FOMC Meeting.
Price is now very close to a bullish trend line and early in today’s session we expect to see a break or a bounce at the said trend line. A bounce higher will take price into the 50 EMA and a break will probably trigger a move into 1.1700 territory but given the lack of major economic releases, we don’t expect to see a break of the 50 EMA or 1.1700 support.
The Eurozone Final Consumer Price Index will be released today at 10:00 am GMT and this will be the only notable event of the day. The CPI shows changes in the price that consumers pay for the goods and services they purchase and acts as the main gauge of inflation but the Final version has a low impact; nonetheless, numbers above the forecast 1.5% usually strengthen the Euro.
Friday the pair dropped on the back of Brexit concerns and lost more than 100 pips, finishing the week in negative territory. However, price is still ranging from a longer term perspective and support is still holding.
The support zone around 1.3320 – 1.3300 rejected price twice in a relatively short period and now it is being tested again. After Friday’s strong drop, we will likely see a small pullback but as long as the pair remains below the 50 period Exponential Moving Average, our bias is bearish, anticipating a break of 1.3320 and a consequent move into 1.3280.
The Pound has a lacklustre day ahead, without any major economic releases. Brexit talks and negotiations can affect the currency, so caution is recommended.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 7-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.