The Euro traded lower mostly throughout this week against the US dollar, and there was hardly any relief for the EURUSD buyers. One of the key reasons for the same was the weakness in the Euro and the impressive economic data in the US. The US dollar was seen trading higher against most of its counterparts, but the Euro was one of the biggest losers this week. The EURUSD pair once broke the 1.3600 support level, then there was not stopping the Euro sellers, as the pair traded close to the 1.3500 support levels. Let’s have a look at the major economic released of yesterday, which impacted the EURUSD pair.
Euro Zone CPI
The Euro zone Consumer Price Index (CPI) data was released by Eurostat earlier during the London session yesterday. The forecast was slated for a stable annual inflation reading of 0.5% in June. The outcome was in line with the expectation, as the Euro zone annual CPI was 0.5% in June 2014. Moreover, the Core CPI also came around the expectation with a reading of 0.8%. According to the report the negative annual rates were observed in Bulgaria (-1.8%), Greece (-1.5%) and Portugal (-0.2%). More importantly, the highest annual rates were recorded in the United Kingdom (1.9%).
The EURUSD pair was seen trading a touch higher after the release, but fell back to trade flat during the London session.
US Initial Jobless Claims
The US Initial Jobless Claims data was released by the US Department of Labor later during the NY session. The forecast was slated for a rise of 5K from 305K to 310K. However, the report mentioned that the initial claims was 302,000, a decrease of 3,000 from the previous week’s revised level in the week ending July 12. This was again on the positive side for the US dollar. The US dollar was seen trading broadly higher after the release.
Just around the time of jobless claims release, the US housing starts and building permits data were also published. The outcome was not as expected by the market. Both the sectors registered a decline. However, the US dollar was not much affected by the outcome.
Overall, the US dollar remained elevated against the major currencies, including the Euro. Today, the Michigan consumer sentiment data will be released, which is expected to rise by 0.5 points. If the outcome surprises and climbs higher, then the US dollar might gain more in the short term, else could correct lower.
Technically, there is an important support around the 1.3500-1.3480 levels. The EURUSD pair must hold this support area if it has to contain more downside in the near term. If it breaks lower and settles below the mentioned support level, then sharp downside possibly towards the 1.3400 level might be on the cards.
So, keep an eye on all the important levels friends and trade accordingly.
Get my Daily Market forecast with trade opportunities HERE: Vladimir’s Markets Forecast
Happy Trading Friends!
