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EUR/USD, GBP/USD, DXY Forecast: USD at $104.80, Key PPI and Claims Data Ahead
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Key Points:
- Core CPI rose by 0.2% MoM, while overall CPI remained flat, missing forecasts.
- U.S. Unemployment Claims expected to decrease to 225,000 from the previous 229,000.
- Dollar Index (DXY) is at $104.810, with a pivot point at $104.901, showing mixed signals.
The USD had a notable impact on major currency pairs this week, driven by the latest U.S. inflation data and Federal Reserve announcements. The Core Consumer Price Index (CPI) rose by 0.2% month-over-month, down from the previous 0.3%, while the overall CPI remained flat, falling short of the expected 0.1% increase.
In addition, CPI eased to 3.3% from 3.4% and the Federal Reserve maintained the Federal Funds Rate at 5.50%, aligning with forecasts. However, the Federal Budget Balance showed a deeper deficit of $347.1 billion compared to the previous $279.6 billion.
Events Ahead
Looking forward, at 9:00, the EUR/USD will react to the Eurozone’s Industrial Production data, forecasted at a modest 0.1% increase compared to the previous 0.6%. The GBP/USD will be impacted by the Bank of England’s Quarterly Bulletin, expected to provide insights into the UK’s economic outlook.
At 12:30, the focus shifts back to the U.S. with the release of Core Producer Price Index (PPI) data, anticipated to rise by 0.3%, and overall PPI, expected to increase by 0.1%.
Additionally, U.S. Unemployment Claims are projected at 225,000, down from 229,000. These figures will be crucial in shaping the market sentiment for these currency pairs and the Dollar Index in the near term.
The Dollar Index (DXY) is trading at $104.810, up 0.04%. The chart timeframe is 4 hours, with the pivot point set at $104.901. Immediate resistance levels are identified at $105.106, $105.454, and $105.655. On the downside, immediate support is at $104.269, followed by $103.999 and $103.765.
Technical indicators show the 50-day Exponential Moving Average (EMA) at $104.784 and the 200-day EMA at $104.826. The Dollar Index remains bearish below $104.901, but a break above this level could shift the bias towards bullish.
EUR/USD Technical Forecast
The EUR/USD pair is currently trading at $1.08047, down 0.03%. The chart timeframe is set to 4 hours, with the pivot point at $1.08155. Immediate resistance levels are at $1.08544, $1.08797, and $1.09163. On the downside, immediate support is noted at $1.07727, followed by $1.07324 and $1.06939.
Technical indicators show the 50-day Exponential Moving Average (EMA) at $1.08113 and the 200-day EMA at $1.08117. The pair remains bearish below $1.08155, suggesting a potential for further decline unless it breaks above this pivot, which could indicate a shift towards a bullish trend.
GBP/USD Technical Forecast
The GBP/USD pair is trading at $1.27805, down 0.01%. The chart timeframe is set to 4 hours, with the pivot point at $1.2752. Immediate resistance levels are identified at $1.2815, $1.2815, and $1.2896. On the downside, immediate support is noted at $1.2705, followed by $1.2673 and $1.2643.
Technical indicators show the 50-day Exponential Moving Average (EMA) at $1.2758 and the 200-day EMA at $1.2688. The pair maintains a bullish outlook above $1.2752, but a break below this level could trigger a sharp selling trend.
For a look at all of today’s economic events, check out our economic calendar.
About the Author
Arslan Aliauthor
Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.
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