The Euro continues to move higher against the US Dollar, as the pair faces no resistance with the start of a new week. It is most likely that the currency exchange rate will reach for the 1.10 mark, where close by it will meet with resistance.
Consumer prices in the United States advanced last month but less than analysts expected. The Labour Department reported on Friday that its CPI rose 0.2% in April, following the preceding month's drop of 0.3% but missing expectations for a 0.3% gain. Furthermore, the so-called core inflation rate climbed 0.1% last month, compared to the previous month's fall of 0.1%, whereas analysts anticipated an increase of 0.2%. However, both figures pointed to a tightening labour market and solid inflation growth, suggesting that the Federal Reserve will likely raise interest rates at its June meeting.
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EUR/USD trades above significant support
During the early hours of Monday's trading session the common European currency scored new heights against the US Dollar, as the currency exchange rate had touched the 1.0950 mark. The currency pair is being supported by the newly calculated weekly PP, which is located at the 1.0932 level. It is most likely that the currency rate will reach for the resistance at 1.0977 by the end of the day. At that level the 50.00% Fibonacci retracement level is located at. However, in the case of a change of the direction the pair might retreat to the 20-day SMA at 1.0873.
Daily chart
Hourly chart
Read More: Technical AnalysisMarket sentiment strongly bearish
SWFX traders remain bearish, as 61% of open positions are short, and 60% of trader set up orders are to sell the Euro.
OANDA traders remain bearish, as 61.49% of trader open positions are short on Monday, compared to 61.41% previously. In addition, SAXO bank clients are also bearish, as 59.73% of open positions are short, compared to the 56.47% positions on Friday.
Spreads (avg, pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade around 1.10 in August
Traders, who were questioned on their longer-term views on EUR/USD between April 15 and today expect, on average, the currency pair to trade around 1.10 in August. In general, 49% of participants believe the exchange rate will be above 1.10 in ninety days, and 35% see it above 1.12. In the meantime, 2% of those surveyed reckon the pair will be at parity or below.