EUR/USD for January 24, 2017

EUR/USD moved higher on Monday as the dollar lost ground following the protectionism oriented speech from President Trump and higher inflation reported by the Bundesbank.  The exchange rate gapped higher and is poised to test the December highs near 1.0855.  Support on the currency pair is seen near the 10-day moving average at 1.0640.  The RSI (relative strength index) broke out which reflects accelerating positive momentum, while the MACD prints in the black with an upward sloping trajectory which reflects accelerating positive momentum.

Bundesbank warns inflation could hit 2% in January. The German central bank said in its latest monthly report that German headline inflation could be a 2% in January, which suggests the number could even be slightly above 2%, and thus above the ECB’s definition of price stability.