Forex News: Yesterday the German ZEW survey showed a disappointing value while the US Consumer Price Index came out better than expected but the pair was difficult to trade, especially on the lower time frames; growing tensions in Ukraine also contributed to this choppy price action.
Although during the second part of yesterday’s session the Euro gained against the US Dollar, the level of 1.3830 couldn’t be broken to the up side, a fact which shows that indecision is present in the market. If the uptrend will resume, today we will probably see a break of the mentioned level; otherwise the support located at 1.3760 will become the first target and the uptrend will be severely weakened.
The day’s most important event is the release of the Euro Zone Consumer Price Index which is scheduled at 9:00 am GMT. The current value is 0.5% and no change is expected but the CPI is the main gauge of inflation so the ECB closely watches it when the Interest Rate decision is made and higher values usually strengthen the Euro. Later in the day, at 12:30 pm GMT the US Building Permits are released, offering insights into the American house market; the expected value is 1.00M, a small decrease from the previous 1.01M and under normal circumstances, higher numbers strengthen the greenback.
United Kingdom’s Consumer Price Index decreased to 1.6%, as anticipated but a huge whipsaw was seen once the number was released and price moved higher after an initial drop.
The bullish momentum seems to fade away and no major advances were made after the double top formed at 1.6822. If price doesn’t cross soon the barrier located at 1.6750, the bears might step in to take control of the pair so for today the main levels to watch are 1.6750 as resistance and 1.6680 as support; the break of either level can trigger a continued move in that direction.
At 8:30 am GMT the Claimant Count Change will be released; the estimated number is -30.2K, an increase compared to last month’s -34.6K and usually, higher levels of unemployment are detrimental for the Pound because jobless people spend less than people who are employed and consumer spending is crucial for the economy. The data released by the United States will directly affect the pair’s direction throughout the day.