EUR/USD Recoups The Critical 1.36 Handle After German CPI Figures
- German CPI (MoM): 0.3% Actual Vs 0.3% Estimated; 0.3% Prior.
- German CPI (YoY): 1.0% Actual Vs 1.0% Estimated; 1.0% Prior.
- EUR/USD Breaks the Critical 1.3600 Level After the Data Release.
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German Consumer Price Index (CPI), which measures changes in the prices of consumer items, increased by 1.0 percent year-on-year for the month of June. This print was faithful to market expectations of 1.0 percent and uniform to the prior month’s price-growth. On a month-to-month basis, the gauge for the strength of domestic inflationary pressures, also crossed the wires in line with economists’ forecasts of 0.3 percent.
Ahead of the data, EUR/USD ran out of gas as it slid below the psychologically significant 1.3600 level to trade as low as 1.3595. The pair’s drift lower may have reflected some anticipation of a weak CPI reading given the data had underperformed relative to consensus forecasts since July 2013 amid swelling stimulus expansion bets says DailyFX Currency Strategist Ilya Spivak. But after the data release, the Euro trimmed losses against the US Dollar to break through the 1.3600 handle.
From a technical perspective, Ilya Spivak mentions near-term support rests at 1.3583 (23.6% Fib Exp.) and support-turned-resistance at 1.3668. He is currently short EUR/USD at 1.3644 in line with the long-term fundamental outlook.
EUR/USD 5 Minute Chart
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Edward Hyon, DailyFX Research Team
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