EUR/USD Mid-Session Technical Analysis for June 9, 2021

The Euro is edging higher on Wednesday, bumped up by lower U.S. Treasury yields and a weaker dollar as investors looked ahead to Thursday’s U.S. inflation data and a European Central Bank (ECB) meeting.

The latest inflation data could lead the Federal Reserve to taper asset purchases sooner rather than later. The Fed has previously contended that higher price pressures are just temporary as the economy continues to rebound from the pandemic-induced recession.

Euro traders will also be monitoring Thursday’s ECB meeting to gauge the pace of the global recovery and policymakers’ thinking about paring back stimulus.

At 13:38 GMT, the EUR/USD is trading 1.2200, up 0.0027 or +0.22%.

The consumer price index (CPI) for May is set to be released at 12:30 GMT on Thursday. Economists are expecting the CPI to rise 4.7% from a year earlier, according to Dow Jones. In April, the CPI increased 4.2% on an annual basis, the fastest rise since 2008.

The ECB is expected to keep policy settings steady, but the Euro is likely to be sensitive to changes in the bank’s economic forecasts or any signal that the pace of bond buying could be reduced in months ahead.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.2254 will change the main trend to up. A move through 1.2104 will signal a resumption of the downtrend.

The minor range is 1.2266 to 1.2104. The EUR/USD is currently straddling its 50% level at 1.2185.

On the downside, the nearest support is a pair of 50% levels at 1.2159 and 1.2125.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD is likely to be determined by trader reaction to the 50% level at 1.2185.

Bullish Scenario

A sustained move over 1.2185 will indicate the presence of buyers. If buying volume increases then look for a potential surge into the nearest main bottom at 1.2254.

Bearish Scenario

A sustained move under 1.2185 will signal the presence of sellers. This could lead to a labored break with potential targets coming in at 1.2159 and 1.2125. The latter is the last potential support before the 1.2104 minor bottom.