Euro creeps higher
The euro is on the rise as the $1.11 region provided support for the single currency, but the US CPI data and statement from Mario Draghi at 1.30pm (London time) and 2.30pm (London time) respectively will provide volatility for the market. EUR/USD hasn’t recovered from the decline due to the front loading of the European Central Bank QE — it has only managed to stem the losses.
The recent economic indicators out of the US have been less than impressive, and even though jobs numbers have been strong consumers are not going out and spending money. A soft CPI report will keep it in the upward trend it has been in since March.
Mr Draghi has a history of taking the euro lower and while Greek uncertainty is still on the agenda, EUR/USD will stay in the long-term downward trend it has been in.
The $1.11 level is acting as support, and a move below it will bring the support at $1.10 into play. Any move to the upside will encounter resistance at $1.13, and the $1.14 region is a major level of resistance.