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EURUSD Consolidation Near Spring 2022 Highs

1/13/2023 10:44 AM

The EUR/USD pair shows flat dynamics during the Asian session, consolidating near 1.0850 and local highs from April 21, 2022. Trading activity remains quite low, while analysts expect a large number of publications of macroeconomic indicators.

The day before, the single currency showed strong growth in response to the release of data on inflation dynamics in the US. In December, the Consumer Price Index slowed down from 7.1% to 6.5% in annual terms, and in monthly terms it corrected from 0.1% to -0.1%. In turn, the CPI excluding Food and Energy added 0.3% in monthly terms and 5.7% in annual terms. Thus, traders strengthened their belief that in the near future the US Federal Reserve will continue to reduce the pace of interest rate increases and will adjust the value by only 25 basis points at its meeting on January 31.

In addition, the focus of investors is statistics on the dynamics of Industrial Production in the eurozone in November, as well as consumer inflation in Spain and France in December, where current forecasts do not suggest changes.

Bollinger Bands on the daily chart show a steady increase. The price range is expanding, but it fails to catch the development of "bullish" activity this week. MACD indicator is growing preserving a stable buy signal (located above the signal line). Stochastic, having reached its highs, reverses into a horizontal plane, indicating overbought euro in the ultra-short term.

Resistance levels: 1.0850, 1.0900, 1.0957, 1.1000. | Support levels: 1.0800, 1.0759, 1.0700, 1.0657.

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