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EUR/USD Slides Further on Mixed German Inflation Data

EUR/USD Slides Further on Mixed German Inflation Data

Nick Cawley, Senior Strategist
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EUR/USD Price, Chart, and Analysis

  • Annual German inflation trickles lower, but m/m price pressures rise.
  • Harmonized inflation continues to push higher.
  • EUR/USD eyeing a break below 1.0100.
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A mixed bag of preliminary German inflation releases with the annual figure slipping 0.1% lower to 7.5% in July, while the monthly figure rose by 0.9%, beating expectations of 0.6%. On a harmonized basis, German inflation rose both monthly and annually, beating forecasts and June’s figures.

German inflation hit 7.9% in May this year, the highest level since German reunification.

Earlier today, EU economic sentiment missed expectations as energy fears weighed on the region.

Euro Update: Economic Sentiment Disappoints, German CPI Later

For all market-moving economic releases and events, see the DailyFX Calendar

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The single currency is trading near its low of the day (1.0113) after having printed a 1.0233 high earlier in the session. The high print was helped by US dollar weakness after last night’s FOMC meeting saw the US dollar fall post-Fed chair Powell’s press conference. EUR/USD remains weak and may well test parity (1.0000) in the near future, especially if upcoming US data underpins the greenback.

EUR/USD Daily Price Chart July 28, 2022

Retail trader data show 57.46% of traders are net-long with the ratio of traders long to short at 1.35 to 1. The number of traders net-long is 15.26% lower than yesterday and 7.80% lower from last week, while the number of traders net-short is 9.88% higher than yesterday and 16.24% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests EUR/USD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current EUR/USD price trend may soon reverse higher despite the fact traders remain net-long.

EUR/USD Bullish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -27% 11% -3%
Weekly -9% 2% -1%
What does it mean for price action?
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What is your view on the EURO – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

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

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