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EUR/USD turns negative near 1.1480 as sentiment sours

  • The pair now sees some selling pressure below 1.1500.
  • The greenback looks to pick up pace near 95.50.
  • US Core CPI rose 0.2% MoM in December, matching consensus.

EUR/USD is now facing some downside pressure, tumbling to the area of daily lows in the 1.1480/75 band.

EUR/USD offered after US data

The positive momentum in the risk-associated complex is now taking a breather and is dragging spot around a cent lower since earlier tops in the boundaries of the 1.1580 region. This area coincides with the 61.8% Fibo retracement of the September-November drop.

On the USD-side, the greenback returns to the positive territory after US inflation figures tracked by the CPI during the last month of 2018 came in in line with previous forecasts. In fact, headline CPI dropped at a monthly 0.1% and rose 1.9% from a year earlier. Additionally, CPI stripping food and energy costs rose 0.2% MoM and 2.2% over the last twelve months.

What to look for around EUR/USD

Near term price action in spot continues to be almost exclusively driven by USD-dynamics and the positive risk appetite trends amidst easing effervescence in the US-China trade dispute. Closer to home, the Italian political scenario, upcoming discussions over the French budget and the palpable slowdown in German fundamentals in Q3-Q4 2018 should keep investors vigilant and could undermine extra gains in EUR in the medium term.

EUR/USD levels to watch

At the moment, the pair is losing 0.15% at 1.1482 and a breakdown of 1.1477 (100-day SMA) would target 1.1409 (21-day SMA) en route to 1.1306 (2019 low Jan.3). On the upside, the next hurdle at 1.1569 (2019 high Jan.10) seconded by 1.1585 (61.8% Fibo of the September-November drop) and finally 1.1621 (high Oct.16 2018).

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