EUR/USD Outlook: Record CPI, Declining German PMI Ahead of ECB Meeting

[MongiIG]

EUR/USD NEWS AND ANALYSIS

• EU finalizes oil ban on Russia, German PMI lower for third consecutive month
• A narrowing window for normalization could complicate next week’s ECB rate meeting
• NFP and US services ISM data to provide volatility later today. Key EUR/USD levels identified

 

Next week, the main events consist of the ECB rate decision, Michigan consumer sentiment and US inflation data.

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EUR/USD KEY TECHNICAL LEVELS

The technical outlook for EUR/USD appears to be pulling away from the May lows as the market anticipates multiple rate hikes from the ECB for the rest of the year. In addition, a potentially worsening economic outlook for the US could add to the recent bullish move in the pair but remains data dependent.

EUR/USD is currently testing 1.0758 with the more significant 1.0805 level the next level of resistance. After breaching above 1.0758, the pair reversed someway short of the 1.0805 level therefore, it is a level of interest to assess a bullish continuation.

Support once again, is the 2020 low of 1.0635 as prices pivoted higher from this level at the start of the trading day.

EUR/USD Daily Chart

Source: TradingView, prepared by Richard Snow

 

Jun 3, 2022 | DailyFX
Richard Snow, Analyst