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EUR/USD, GBP/USD, DXY Price Forecast: DXY Nears $105, US CPI in Focus

By:
Arslan Ali
Published: Jul 11, 2024, 07:00 GMT+00:00

Key Points:

  • German industrial production data boosts Euro, hitting a 0.5% increase versus 0.0% forecast.
  • UK MPC members' speeches and House Price Balance impact GBP; balance reported at -17%.
  • US Dollar weakens with Powell's testimony and steady Wholesale Inventories at 0.6%.
EUR/USD, GBP/USD, DXY Price Forecast: DXY Nears $105, US CPI in Focus

In this article:

Market Overview

On Wednesday, July 10, German Buba President Nagel’s speeches and Italian Industrial Production data, which showed a 0.5% increase compared to a forecast of 0.0%, impacted the Euro (EUR). Meanwhile, in the UK, speeches from MPC Members Pill and Mann likely affected the British Pound (GBP), with the RICS House Price Balance reporting a decline to -17%, matching previous data.

In the US, Federal Reserve Chair Powell’s testimony was a focal point, along with the Final Wholesale Inventories report showing a consistent 0.6% change.

Events Ahead

On Thursday, July 11, the German Final CPI m/m is expected to remain steady at 0.1%. For the UK, GDP m/m is forecasted at 0.2%, alongside Construction Output at 0.5%, and Industrial Production at 0.3%.

The Goods Trade Balance is expected to narrow to -15.6B from -19.6B. The BOE Credit Conditions Survey and NIESR GDP Estimate, projected at 0.7%, will also be key.

In the US, the focus will be on the Core CPI m/m, expected to remain at 0.2%, and the CPI y/y, anticipated to dip to 3.1% from 3.3%. Unemployment Claims are forecasted at 236K, slightly down from 238K.

The Federal Budget Balance is projected to show a significant improvement, moving from -$347.1B to -$71.2B. The Dollar Index, currently at 104.931, down 0.03%, could face further pressure if the CPI data indicates cooling inflation.

Powell’s cautious tone and potential dovish hints from FOMC members could reinforce a bearish outlook.

US Dollar Index (DXY)

Dollar Index Price Chart - Source: Tradingview
Dollar Index Price Chart – Source: Tradingview

 

The Dollar Index is trading at $104.931, down 0.03% in the latest session. The two-hour chart highlights key levels with a pivot point at $105.180. Immediate resistance is at $105.331, followed by $105.481 and $105.624. On the downside, immediate support is at $104.803, with further support at $104.662 and $104.528.

Technical indicators suggest a bearish trend, with the 50-day EMA at $105.095 and the 200-day EMA at $105.297. The outlook remains bearish below $105.180; a break above this level could shift the trend to bullish.

EUR/USD Technical Forecast

EUR/USD Price Chart - Source: Tradingview
EUR/USD Price Chart – Source: Tradingview

EUR/USD is trading at $1.08369, up 0.07% in the latest session. The two-hour chart highlights key levels with a pivot point at $1.08309. Immediate resistance is at $1.08463, followed by $1.08615 and $1.08752. On the downside, immediate support is at $1.08139, with further support at $1.07993 and $1.07835.

Technical indicators show a bullish trend, with the 50-day EMA at $1.08174 and the 200-day EMA at $1.07795. The outlook remains bullish above $1.08309; a break below this level could trigger a sharp selling trend.

GBP/USD Technical Forecast

GBP/USD Price Chart - Source: Tradingview
GBP/USD Price Chart – Source: Tradingview

About the Author

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.

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