EUR/USD: Bullish Scenario with Target 1.11 Next Week

14 janv.

The EUR/USD exchange rate rose above 1.0950 and erased its daily losses in the early American session on Friday. Data from the United States revealed that the monthly Core PPI remained unchanged in December for the third consecutive month, exerting pressure on the US Dollar (USD) and assisting the pair in moving higher. The pair held steady above 1.0950 on Friday morning as markets awaited producer inflation data from the US. Mixed inflation figures from the US increased market volatility on Thursday. The Consumer Price Index (CPI) rose by 3.4% on a yearly basis in December, as reported by the US Bureau of Labor Statistics (BLS). This reading followed the 3.1% increase recorded in November and exceeded the market expectation of 3.2%. The Core CPI, excluding volatile food and energy prices, rose by 0.3% on a monthly basis, matching analysts' estimates. These data did not significantly impact the market's stance on the Federal Reserve's (Fed) policy outlook. The CME FedWatch Tool indicates a 70% probability of a 25 basis points rate reduction in March. My analysis anticipates a bearish start to the week towards 1.085 to establish a significant low, or rather a false low with a recovery towards Tuesday/Wednesday, and Thursday could potentially bring the price back towards 1.11 before a slight retracement on Friday. Wishing everyone a good Sunday. Greetings from Nicola.