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The EUR/USD pair shows moderate growth, recovering from a three-day decline, which resulted in the renewal of local lows from January 6. The instrument is testing 1.0600 for a breakout, waiting for new "bullish" drivers to emerge.

Investors are focused on statistics on the dynamics of Germany's Gross Domestic Product (GDP) for the fourth quarter of 2022. Also during the day, traders expect the publication of Consumer Confidence index from Gfk Group for March. Current forecasts suggest that the German economy will decline by 0.2% QoQ and show growth of 0.5% YoY, which is in line with analysts' preliminary estimates. At the same time, the Consumer Confidence index is likely to rise from -33.9 points to -30.4 points.

Moderate support for the single currency is provided by yesterday's macroeconomic data from the eurozone on inflation in January: the Consumer Price Index on a monthly basis adjusted from -0.4% to -0.2%, and on an annualized basis it fell from 9.2% to 8.6% (downward dynamics recorded in 18 EU Member States). At the same time, the Core CPI on a monthly basis remained at the same level of -0.8%, and on an annual basis it increased from 5.2% to 5.3%. Experts from the Statistical Office of the European Union (Eurostat) recorded the most rapid growth in Hungary, where prices added 26.2%, in Latvia (21.4%) and the Czech Republic (19.1%), while in Luxembourg inflation was 5.8%, and in Spain it amounted to 5.9%. However, Isabel Schnabel, member of the board of the European regulator, noted earlier that this would not be enough to start easing monetary conditions, since some slowdown in dynamics was caused, rather, by a correction in energy prices (in January their share fell to 2.17%), and not general improvement in the situation.

Thus, analysts once again received confirmation of their assumptions regarding further tightening of monetary policy by the European Central Bank (ECB). In March, the regulator plans to raise the interest rate again by 50 basis points.

Bollinger Bands in D1 chart demonstrate flat dynamics. The price range is expanding, but it fails to keep pace with the "bearish" activity of recent days. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic retains a downtrend but is located in close proximity to its lows, which indicates the risks of oversold euro in the ultra-short term.

Resistance levels: 1.0600, 1.0654, 1.0700, 1.0765. | Support levels: 1.0550, 1.0500, 1.0450, 1.0400.