Ahead of US CPI Data, EUR/USD Jumps to 5-Week High!


The US dollar in trading in the New York session last night was seen moving against the direction if the published data supported the confirmation of its value.

The United States (US) retail price index (PPI) data reading for April was published last night with higher figures beating forecasts.

This gives an initial warning that user inflation (CPI) will also increase in the latest readings to be published in the New York session tonight.

The statement by the Chairman of the Federal Reserve (Fed) Jerome Powell in Amsterdam last night was seen as remaining in a 'hawkish' tone as before in order to maintain high profit rates for longer.

Examining the price movements that occurred on the EUR/USD currency pair chart overnight, the price increase has reached its latest 5-week high.

At the start of the New York session, the initial strengthening of the US dollar pushed the price to around 1.07700 before the situation changed to see a significant spike in the price breaking through the 1.08000 resistance zone.

The latest high was reached at around 1.08250 before the price slowly and flattened so that trading continued to the opening of the Asian session this morning.

With price movements remaining above the 50 Moving Average (MA5) support line on the 1 hour time frame on the EUR/USD chart, the trend remains bullish with a tendency for prices to continue climbing.

The latest high level will be recorded again with the target for the price to reach the next support zone at 1.09000.

On the other hand, if the price falls below 1.08000, it will be a bearish signal for the price and it is possible that a downward price movement will begin.

For price declines, the target is to head towards 1.07000 which the price failed to break last week.