After several weeks of sideways movement, the “lid was blown” last week and the pair climbed above USD 1.1480 at times – despite record US inflation data mid-week and rising US interest rates. What’s in store for the upcoming trading week?
With a U.S. holiday, it goes today, Monday, initially very leisurely into the new trading week, the upcoming economic data (see below) are also almost all in the category “second series” to be classified and should not be able to trigger any sustainable impetus. Trading is therefore likely to be primarily technical.
Chart Technical Outlook:
The former resistance area around USD 1.1385/90 will play a crucial role on the downside in the coming days. After the sell-off last Friday, an inverse-V reversal must be expected here. Therefore, an attack of the bears on the mentioned support is very likely in the coming trading days. A breach below this zone (USD 1.1385) would generate a rather strong sell signal, in which case quick follow-through selling into the lower 1.12 area would be favored. Until then, however, the bulls should not (yet) be written off as far as a trend continuation on the upside is concerned.
Important economic data/ events for EURUSD:
US Bank Holiday
11:00 a.m.: ZEW Index Germany
14:30: NY Empire State manufacturing index (Jan)
14:30 Building permits (month) (Dec)
14:30: Philly Fed manufacturing index (Jan)