Home Forex Markets EUR/USD: The euro’s gains are in full swing, and US CPI may help EUR/USD hit September highs

EUR/USD: The euro’s gains are in full swing, and US CPI may help EUR/USD hit September highs

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EUR/USD: The euro’s gains are in full swing, and US CPI may help EUR/USD hit September highs


EUR/Dollar extends gains since last week’s U.S. nonfarm payrolls report, rising for a third day10month high1.0094probably will try to test9month high1.0198.

EUR/dollar breaks10Month high, next target to look at9month high

Euro as dollar weakens/The U.S. dollar made a series of higher highs and lows, and the U.S. consumer price index (CPI) will likely show a slowdown in inflation, a data release that may not provide much support for the dollar.

America’s latestCPIThe data results may affect the outlook for monetary policy, market expectations10monthCPIand coreCPIGrowth will slow, and signs of easing price pressures could push the Fed to shift its stance on rate hikes as it works to achieve a soft landing for the economy.

Given that ECB President Lagarde (Christine Lagarde) reiterated that the European Central Bank expects “further rate hikes”, and market bets that the Fed will slow the pace of rate hikes may support the euro/The dollar continues to hold firm. In addition, in a recent speech in Germany, Lagarde also said that “exiting the easing policy may not be enough to bring inflation back to the target level.”

ECB comments could extend its rate hike cycle until20232019, because the ECB is currently struggling to achieve its goal of price stabilization, which is its only mission.Given that euro zone inflation has risen to record highs, the ECB may12moon15Rate hike announced at the interest rate decision meeting75basis point.

Therefore, the euro/USD from9month low0.9536The rally could turn out to be a key reversal as the pair breaks out11The month’s opening range and further gains are likely to drive a shift in retail sentiment, as it did earlier this year.

IGCustomer sentiment report shows44.17%of traders currently hold EUR/The dollar is net long, and the short-to-long ratio is1.26:1.

The number of net long traders is down from yesterday12.75%down from last week27.98%while the number of net shorts rose from yesterday7.59%down from yesterday40.42%.Net longs decline likely due to euro/Dollar hits monthly high1.0096while a sharp rise in net shorts drove a shift in retail sentiment, with66.90%of traders are net long.

In short, if the United StatesCPIData showing slowing inflation may support euro/Dollar remains firm as it prompts market bets on Fed12The pace of interest rate hikes slowed in the month.Breaking up in the exchange rate10month high1.0094After that, it may continue to challenge upwards9month high1.0198.

EUR/USD daily chart

EUR/USD: The euro's gains are in full swing, and US CPI may help EUR/USD hit September highs

source:Trading View

EUR/Dollar rises to new monthly high1.0096broke10month high1.0094as the exchange rate continued its trend of recording a series of highs and lows since last week, closing at1.0070(161.8%Fibonacci extension) above raises the challenge9month high1.0198possibility.

Therefore, from9month low0.9536The start of the rally could be the euro/A key reversal for the dollar as50Daily moving average (currently at0.9879) turns up if the price breaks9month high1.0198is expected to rise to1.0220(161.8%Fibonacci extension).

If it breaks above the above level, the next target is to look at1.0370(38.2%Fibonacci extension), which is basically the same as8month high1.0369Coincidence, but if the exchange rate fails to break above9month high1.0198may make the euro/Dollar remains range-bound, if broken1.0070(161.8%Fibonacci extension), it may fall back to0.9910(78.6%retracement) to0.9950(50%Fibonacci extension).

(Written by David Song, translated by Leona)

Under the expectation of economic recession, the market is like a “frightened bird”, and the inflation data has detonated the audience several times! How to trade sudden market?

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