We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bearish
Wall Street
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
GBP/USD
Bullish
USD/JPY
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Heads Up:🇧🇷 BCB Focus Market Readout due at 11:30 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-05-25
  • 🇲🇽 Balance of Trade Actual: $-3.087B Expected: $2.04B Previous: $3.398B https://www.dailyfx.com/economic-calendar#2020-05-25
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.32%, while traders in US 500 are at opposite extremes with 76.77%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/Tha105cXZ5
  • Heads Up:🇲🇽 Balance of Trade due at 11:00 GMT (15min) Expected: $2.04B Previous: $3.392B https://www.dailyfx.com/economic-calendar#2020-05-25
  • Commodities Update: As of 10:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.73% Gold: -0.29% Silver: -0.85% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/enjCuKY7xE
  • $SPX faces pivotal resistance, while #FTSE 100 continues to trade in rangebound fashion. Get your #equities technical analysis from @JMcQueenFX here: https://t.co/JXLZIbXzrQ https://t.co/37cpFa4skw
  • Forex Update: As of 10:00, these are your best and worst performers based on the London trading schedule: 🇨🇦CAD: 0.21% 🇬🇧GBP: 0.11% 🇦🇺AUD: -0.03% 🇳🇿NZD: -0.05% 🇨🇭CHF: -0.06% 🇯🇵JPY: -0.08% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/W8OTNI6e3n
  • 🇮🇱 GDP Growth Rate QoQ 1st Est Actual: -1.8% Previous: 1.1% https://www.dailyfx.com/economic-calendar#2020-05-25
  • Indices Update: As of 10:00, these are your best and worst performers based on the London trading schedule: Germany 30: 1.93% France 40: 1.28% FTSE 100: 1.25% Wall Street: 1.10% US 500: 1.08% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/Fn5s0UlxkI
  • Heads Up:🇮🇱 GDP Growth Rate QoQ 1st Est due at 10:00 GMT (15min) Previous: 1.1% https://www.dailyfx.com/economic-calendar#2020-05-25
Below-Forecast U.S. CPI, Retail Sales to Fuel EUR/USD Rate Rally

Below-Forecast U.S. CPI, Retail Sales to Fuel EUR/USD Rate Rally

2018-01-12 08:00:00
David Song, Strategist
Share:

- U.S. Consumer Price Index (CPI) to Slow to Annualized 2.1% from 2.2% in November.

- Core Inflation to Hold Steady at 1.7% per Annum, Retail Sales to Increase 0.5% .

Trading the News: U.S. Consumer Price Index (CPI)

U.S. CPI

Fresh developments coming out of the U.S. economy may fuel the near-term rally in EUR/USD as the Consumer Price Index (CPI) is projected to slow in December, while Retail Sales are expected to increase 0.5% following the 0.8% rise in November.

A set of lackluster data prints is likely drag on the U.S. dollar as it curbs bets for an imminent rate-hike, and the Federal Open Market Committee (FOMC) may largely endorse a wait-and-see approach at the next rate decision on January 31 as inflation continues to run below the 2% target.

Signs of subdued price growth may also spark a growing dissent within the central bank as ‘some participants observed that there was a possibility that inflation might stay below the objective for longer than they currently expected,’ with the FOMC running the risk of completing its hiking-cycle ahead of schedule especially as ‘other persistent factors may be holding down inflation, which would present challenges for the Committee in promoting a return of inflation to 2 percent over the medium term.’

Nevertheless, a set of positive U.S. data prints may tame the recent pickup in EUR/USD, with the pair still at risk of carving a double-top formation amid the failed attempt to clear the September-high (1.2092). New to trading? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Impact that the U.S. CPI has had on EUR/USD during the previous release

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

NOV

2017

12/13/2017 13:30:00 GMT

2.2%

2.2%

+26

+91

November 2017 U.S. Consumer Price Index (CPI)

EUR/USD 5-Minute Chart

EUR/USD Chart

The U.S. Consumer Price Index (CPI) climbed to an annualized 2.2% from 2.0% in October, while the core rate of inflation unexpectedly slipped to 1.7% from 1.8% during the same period to mark the first slowdown since May. A deeper look at the report showed a 3.9% rise in Energy prices, with transportation costs also climbing 1.9%, while prices for Apparel fell 1.3% in November.

The mixed detailed surrounding the inflation report dragged on the U.S. Dollar, with EUR/USD climbing above the 1.1750 region to end the day at 1.1826. For additional resources, download and review the FREE DailyFX Advanced Guide for Trading the News to learn our 8 step strategy.

EUR/USD Daily Chart

EUR/USD Daily Chart

Want more insight? Join DailyFX Currency Analyst David Song LIVEto cover the market reaction to the U.S. CPI & Retail Sales report.

  • EUR/USD appears to be making another attempt to test the September-high (1.2092) as it snaps the series of lower highs & lows from earlier this week, with both price and the Relative Strength Index (RSI) on course to extend the bullish formations carried over from late-2017.
  • Break above the September-high (1.2092) would negate the threat for a double-top, with the next topside hurdle coming in around 1.2130 (50% retracement) followed by the 1.2230 (50% retracement) region.
  • May see EUR/USD stage a more meaningful advance if the RSI pushes into overbought territory as it suggests the bullish momentum is gathering pace.

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.