As expected, the United States (US) inflation rate soared again on the latest data readings published in the New York session yesterday.
The annual inflation reading jumped to 8.5% from 8.4% from 7.9% previously, while the monthly reading was up to 1.2% from 0.8% for March.
The US dollar met analysts' expectations to strengthen until the end of the New York session, however, the US dollar was initially seen weakening shortly after the data was published.
As can be seen on the price chart of the EUR/USD pair, the price slightly rose to the level of 1.09000 following the initial reaction to the release of the inflation data before making a decline to the latest low for this week.
A decline of around 80 pips was recorded hitting the level around 1.08200 indicating the price continued the decline on the bearish trend which still saw the price move below the Moving Average 50 (MA50) barrier level on the 1 hour time frame.
The support zone at 1.0800 is the focus to be tested today which is an important zone that has curbed the lower fall in prices in March trading last year.
If the price declines lower beyond the zone, the next target of the price is seen at around 1.0700 for a continued decline in the price thus recording the latest 2 -year low.
However, beware if the price movement after this deviates from the expected decline, price increases can occur and give a shock in the market.
For a rise, the initial resistance zone is at 1.09000 to be tested before a higher rise will lead to the previous resistance level of 1.1000.
Investors will also be wary of Euro trading ahead of the outcome of the European central bank (ECB) meeting on Thursday which will affect the direction of price movements.
