EUR/USD: outlook for July 18-24
During the past week EUR/USD remained within range of the 2 previous weeks. The pair got strength from higher EUR/GBP and EUR/JPY, but terror attack in Nice on Thursday together with good US statistics didn’t let the bulls to develop the move to the upside.
Euro area’s inflation figures were in line with forecasts. Headline CPI posted only the second gain in 2016 and the figures are still far below the European Central Bank’s target. Traders will look forward to more policy easing from the ECB that will meet on Thursday. However, the expectations declined after the Bank of England decided to keep policy unchanged during the past week. In addition, as the ECB’s policy is already very accommodative, new steps tend to have less and less impact on EUR/USD. So, any short positions should have conservative targets.
Other important events in the euro area’s economic calendar include Germany’s and region’s ZEW economic sentiment index on Tuesday and European flash manufacturing & services PMIs on Friday.
On the daily chart 50-day MA went below 100-day MA providing bearish signal. Resistance lies at 1.1160 and 1.1260. Support is at 1.1000 and 1.0920.