EUR/USD Prediction for January 23, 2017

The EUR/USD moved higher following stronger than expected German PPI and following the Inauguration of U.S. President Donald Trump.  Support on the currency pair remains near the 10-day moving average at 1.0625.  The exchange rate is attempting to form a bottom.  Resistance is seen near the December highs at 1.0855.  The RSI was unable to pierce new highs, as momentum remains positive.

German PPI inflation jumped to 1.0% year over year in December from 0.1% year over year in the previous month. The sharp acceleration in import price inflation previously and the pick up in HICP were clues that this number would be elevated. The breakdown showed that energy prices were up 0.2% year over year, after falling -1.7% in the previous month, while non-durable goods prices jumped 2.1% year over year, after 1.5% year over year in November.