EURUSD shows minor gains with focus on U.S. economic data releases this week

EURUSD Analysis

Performance after Monday
Period	Pct	Chg	Momentum
Monday	0.04%	4.2 Pips
Week to-date	0.11%	11.5 Pips
January	-1.46%	-151.9 Pips

Upcoming key events (London Time)

Tue 01:30 PM USD PPI excluding Food and Energy sectors (12-mth)
Wed 01:30 PM USD CPI Inflation Rate (12-mth)

What happened lately

The economic data for both Europe and the United States lacks any significant events at the present moment. However, this week, the focus shifts to the United States as notable economic indicators are scheduled for release. These include the Producer Price Index (PPI) excluding Food and Energy and the Consumer Price Index (CPI) Inflation Rate, both considered high-impact events.

The Producer Price Index data is scheduled to be reported on Tuesday, with the exclusion of the volatile Food and Energy sectors to provide a clearer view of inflation pressures on producers. On Wednesday, the Consumer Price Index Inflation Rate will be released, which is a critical measure of inflation and is closely watched by market participants and policymakers. These indicators are essential in understanding the inflation trajectory in the U.S. and play a significant role in dictating monetary policy decisions by the Federal Reserve. Both the PPI and CPI outcomes have the potential to influence the U.S. Dollar’s strength, as they provide insights into inflation trends and expectations.

In regard to the EURUSD currency pair, the current performance reflects a minor increase of 0.04%, bringing the exchange rate to 1.02543. This change, though marginal, suggests a slight strengthening of the Euro against the U.S. Dollar as reported by economicrecap.com. Investors and traders are likely positioning themselves cautiously ahead of the upcoming U.S. inflation data. An uptick in inflation might prompt the Federal Reserve to maintain or even increase interest rates to curb inflation, which could lead to dollar strength. Conversely, if inflation data comes in weaker than expected, it could reduce the pressure on the Federal Reserve to raise rates, potentially leading to a weaker dollar. Thus, the EURUSD could experience volatility based on the direction and the strength of the U.S. inflation data. Overall, the anticipated data releases this week are expected to significantly influence trading strategies and sentiments surrounding this major currency pair.

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What can we expect from EURUSD today?

EURUSD on Monday rose 0.04% to 1.02543. Price is below 9-Day EMA while Stochastic is falling.

Updated daily direction for EURUSD looks bullish as the pair ended higher after Monday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.0283 with break above could target R2 at 1.03117 or figure level area. While towards the downside, we are looking at daily low of 1.01772 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.02588 may suggest continuation after recent positive movement.

For the week to-date, take note that EURUSD is mixed as compared to the prior week.

Key levels to watch out:

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