EURUSD is at a crossroads, poised to respond to critical economic data from key players in the global economy. Yesterday EURUSD sport market had a strong downward pressure with a 1% correction from 1.06336 - 1.05256 after a strong news coming from the US related to CPI, Core CPI, Inflation & Initial Jobless claim. Today, on Friday, China, the US, and the European Union are set to release pivotal figures that could sway the direction of the EURUSD trading pair.
In the second-largest economy, China, expectations of a higher YoY inflation rate (0.2%) and a growth in the balance of trade ($70 billion) are on the horizon. This outcome could further solidify China's status as a significant trading partner with the European Union.
Meanwhile, in the EU, Industrial Production forecasts suggest a positive shift (0.1%) following a previous dip (-1.1%). If this comes to pass, it may provide essential support to the Euro and its strong recovery.
Across the ocean, the US contributes to the mix with Import and Export Prices forecasts (0.5%), while the Michigan Consumer Sentiment is expected to dip slightly from 68.1 to 67.2.
The collective influence of these economic indicators will shape the path of EURUSD. Bullish potential lies in robust performances from China and the EU, combined with disappointing results from the US. Stay tuned for these releases as they paint the picture for EURUSD's next move.
The present situation unveils important indicators such as the EMA 50 and EMA 200 still portraying a bullish trend. The EMA 50's position above the EMA 200 signifies this optimism. However, this scenario may not persist if the ongoing downward pressure maintains its course.
Analyzing the Anchored VWAP, initiated from Thursday's high, discloses that the current price lies below the VWAP's midline, depicted in orange. Historically, when the price falls below the VWAP line, it typically suggests a bearish sentiment. According to this Anchored VWAP configuration, the key resistance levels are located around the mid VWAP at 1.0570 and the VWAP's first upper band at 1.0616.
One strategy involves employing the low volume area of the volume profile as a pivotal support level. This essential support zone is highlighted in a red rectangle and extends from 1.0482 to 1.0503. In the short term, it's crucial for this key support level to anchor EURUSD's price movements.
Examining the widely favored MACD oscillator indicator with default settings, it currently reflects a bearish trend. Both the histogram and the signal line remain above the 0 line. To provide more precision, the signal line now resides beneath the histogram, indicating a bearish correction. In most cases, bearish trends persist when the histogram crosses below the signal line.
Forecast 0.2%, previous 0.1%
Forecast $70B, previous $68.36B
Forecast 0.1%, previous -1.1%
Forecast 0.5%, previous 0.5%
Forecast 0.5%, previous 1.3%
Forecast 67.2, previous 68.1
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