Euro awaits CPI data
EUR/USD is trading sideways and expectations are that volatility will remain muted ahead of the eurozone final CPI report at 10am (London time). The market is expecting no change from the preliminary reading of -0.3% last month, and should estimates be met it would ramp up speculation about quantitative easing.
The next European Central Bank meeting is the talk of the town and the surprise move by the SNB yesterday just shows how apprehensive the Swiss are about QE from Mario Draghi.
We are just over one week way from the Greek general election, and the left-wing Syriza party is still leading in the polls. The political uncertainty will keep the downside bias on EUR/USD.
Following a sharp move lower yesterday, EUR/USD has rallied off its $1.1569 low to its currently level of $1.1635. Intermediate downside support is at $1.16, which if held would then put the pair’s 50-period (hourly) moving average at $1.1713 target in sight. However, a move below $1.16 would then see current support turn into resistance with downside support at $1.15.