Uncle Sam is about to print the Fed’s preferred inflation gauge!
How will the release affect EUR/USD’s short-term uptrend?
Before moving on, ICYMI, yesterday’s watchlist checked out CAD/JPY’s triangle consolidation ahead of Canada’s retail sales report. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
Canada’s retail sales growth unchanged from March to April vs. a 1.5% uptick expected
U.S. GDP revised lower from -1.4% to -1.5% in Q1 2022
U.S. initial jobless claims down by 8K to 210K in the week ended May 21
U.S. pending home sales index plunged by 3.9% to a two-year low of 99.3 in April
AU retail sales gain by another 0.9% after a 1.6% increase in April
Dollar set for biggest weekly drop in nearly 4 months as rate bets cool
Asian shares track Wall Street gains
U.S. core PCE price index at 12:30 pm GMT
U.S. personal income and spending at 12:30 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: EUR/USD
Talks of the European Central Bank (ECB) members being more open to interest rate hikes have been supporting EUR/USD, which has been seeing higher highs and higher lows since mid-May.
Can the bulls extend their run today?
EUR/USD is retesting an unbroken trend line support AND the 100 SMA on the 1-hour time frame.
The pair could make or break its short-term uptrend when the U.S. prints its core PCE price index later today.
For newbies out there, the report is the Fed’s preferred inflation measure.
Analysts see a 0.3% uptick for April but a stronger reading would support the members’ plans to raise interest rates by another 50 basis points in their next meetings.
If the PCE report comes in hotter than expected, then EUR/USD could break below the trend line and retest the 1.0650 previous area of interest. Heck, it could even drop down to the 1.0620 levels near the 200 SMA!
A not-so-hot reading, on the other hand, or continued risk-taking during the London and U.S. sessions, could push EUR/USD from its trend line support all the way to its 1.0750 highs.
Keep close tabs on this one, forex friends!