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EUR/USD, GBP/USD, DXY Price Forecast: DXY at $104.85; US Inflation Ahead
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Key Points:
- US Core PPI rose by 0.5% month-over-month, surpassing the previous increase of 0.2%.
- UK claimant count decreased to 8.9K, below the forecasted 13.9K.
- US Core Consumer Price Index (CPI) for April is expected to increase by 0.3% month-over-month, down from the previous 0.4%.
In the United Kingdom, labour market data revealed mixed results. The claimant count Change decreased to 8.9K, below the forecasted 13.9K and the previous -2.4K. Meanwhile, the Average Earnings Index for the past three months remained at 5.7%, aligning with expectations but higher than the previous 5.3%. The unemployment rate edged up to 4.3% from 4.2%, meeting the forecast.
Events Ahead
Looking ahead, the US Core Consumer Price Index (CPI) for April is expected to increase by 0.3% month-over-month, down from the previous 0.4%. Core Retail Sales are forecasted to rise by 0.2%, a significant drop from the prior 1.1%.
The overall CPI is projected to remain steady at 0.4% month-over-month, while the annual CPI is expected to ease slightly to 3.4% from 3.5%. The Empire State Manufacturing Index is anticipated to improve to -9.9 from -14.3, and Retail Sales are expected to grow by 0.4%, down from the previous 0.7%.
In Europe, the Flash Employment Change and Flash GDP for Q1 are both forecasted to rise by 0.3%, consistent with previous readings. Industrial Production is expected to grow by 0.5%, slightly down from the prior 0.8%. In the United Kingdom, a 10-year Bond Auction is scheduled, with the previous yield recorded at 4.37%.
US Dollar Index (DXY)
The Dollar Index (DXY) is trading at $104.873, down 0.14% today. The 4-hour chart shows the pivot point at $105.067, which serves as a critical level for traders. Immediate resistance levels are at $105.475, $105.740, and $106.146, suggesting potential upward targets.
On the downside, immediate support is found at $104.679, followed by $104.200 and $103.886. Technical indicators highlight a bearish trend below the pivot point. The 50-day EMA is at $105.283, and the 200-day EMA is at $105.216. A break above $105.067 could signal a bullish shift while staying below this level supports a bearish outlook.
EUR/USD Technical Forecast
The GBP/USD is trading at $1.25949, up 0.02%. The 4-hour chart indicates a pivot point at $1.25811, a critical level for traders. Immediate resistance levels are at $1.26340, $1.26648, and $1.27077, signalling potential upward targets. On the downside, immediate support is at $1.25214, followed by $1.24659 and $1.24233.
Technical indicators suggest a bullish trend above the pivot point. The 50-day EMA is at $1.25378, and the 200-day EMA is at $1.25432. A break below $1.25811 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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