On Friday, the EUR/USD traded sideways after jumping up to the 1.12500 level. The surge began as soon as the US President made comments on the trade talks between the US and China.
Meanwhile, note that the currency exchange rate has been largely ignoring all of the technical levels like the simple moving averages, Fibonacci retracement levels and pivot points.
The European Common Currency traded sideways against the US Dollar, following the US PPI data release on Thursday at 12:30 GMT. The EUR/USD exchange currency rate lost 4 pips or 0.03% right after the release. The Euro continued trading at the 1.1196 level against the US Dollar.
Bureau of Labor Statistics released the US PPI data, which came out in line with expectations of 0.2%.
According to the release: "The Producer Price Index for final demand rose 0.2 percent in April, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.6 percent in March and 0.1 percent in February. On an unadjusted basis, the final demand index increased 2.2 percent for the 12 months ended in April."
US CPI left this week
At 12:30 GMT the Canadian Employment data will cause a move of about forty pips.
At the same time the US Consumer Price Index release should cause a move of up to twenty pips.
Watch this week's economic calendar analysis and leave comments with questions about the specifics.
EUR/USD hourly chart's review
Yesterday, the EUR/USD currency pair jumped to the psychological level at the 1.1230 mark.Given that the pair is supported by the monthly PP at 1.1217 mark, it is likely, that bulls could prevail in the market in the nearest future. A possible upside target is the psychological level at 1.1250.
On the other hand, it is expected, that the exchange rate could trade sideways, trying to breach the given resistance.
It is unlikely, that the rate could decline lower than the 1.1200 mark due to the support level formed by the 55-, 100– and 200-hour SMAs, the weekly PP and the Fibo 38.20%.
Hourly Chart
On the daily candle chart, there is additional new information to take into account.
The 55-day simple moving average was strengthening the weekly R1 at 1.1268.
Daily chart
On Friday, on the Swiss Foreign Exchange 73% of the total open position volume was in short positions.
Traders still expect the pair to decline. The recent surge did not cause a decline in the bearish sentiment
Meanwhile, trader set up pending orders in the 100-pip range were neutral. Namely, 50% of all orders were set to buy and 50% were set to sell.