Euro vs US Dollar Technical Analysis

The Euro broke higher during the trading session on Wednesday in the early hours. Breaking above the crucial 1.10 level. This is an area that has been important multiple times, and therefore I think we will continue to look at it through the prism of something that must be paid attention to. We do have CPI numbers coming out of the United States later that could turn things around, but if we do not break back down below the 1.10 level, it opens up a move to the 1.11 level, followed by the 1.1250 level.

The whole world is basically betting on the idea that the Federal Reserve is going to cut rates, and they are trying to get in front of it. The question now is whether or not they cut rates enough to justify the move. We’ll have to wait and see, because of course you have to keep in mind that the European Central Bank is likely to loosen monetary policy as well. While this is a bullish sign, we need to get through CPI, and CPI is expected to be 0.2% in America, so we will have to see how that plays out.

If CPI comes in hot and we break down below the 1.0980 level, it’s very likely that we go back to the 1.09 level. However, if it comes in as expected, then I think you’ll probably see more of a drift to the upside as the market does just tend to follow right along the path that it has been over the last several days.

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