Latest EUR/USD Analysis: US CPI Data Impacts Currency Pair
- US Consumer Price Index rose higher than expected, impacting market sentiment
- Investors reconsider Federal Reserve’s potential interest rate cut
- EUR/USD faces downside risk despite recent bounce
The EUR/USD pair is trading near a four-week low of 1.1002 following the release of US Consumer Price Index (CPI) data. The US CPI rose by 2.5% annually in August, lower than July’s 2.9%, while the core annual figure remained unchanged at 3.2%. These figures have dampened expectations for a 50 basis points interest rate cut by the Federal Reserve next week, leading to a stronger US Dollar against major currencies.
With the European Central Bank (ECB) expected to announce a rate cut, market sentiment remains cautious as stocks decline. Technical analysis suggests a bearish outlook for the EUR/USD pair, with resistance levels at 1.1050, 1.1090, and 1.1140.
EUR/USD Technical Analysis
In the daily chart, the 20 Simple Moving Average (SMA) acts as a resistance level at 1.1090, while longer moving averages indicate downward pressure. The 4-hour chart shows a bearish trend, with the pair testing support at 1.0990, 1.0950, and 1.0910. Technical indicators suggest further downside movement.
Key Takeaway: US CPI data has impacted market sentiment, leading to a stronger US Dollar and a bearish outlook for the EUR/USD pair. Investors should monitor upcoming ECB decisions and technical indicators for potential trading opportunities.