EURUSD Approach Three Year Lows After U.S. CPI – Initial Jobless Claims
EURUSD is hovering in negative territory for the eighth trading session out of the last nine sessions. Weak European Union fundamentals and especially weak industrial production from Germany weigh on the common currency. Above that a spike in coronavirus cases today from China spooked investors and shift their attention to safe-haven assets. As of writing EURUSD is 0.13% lower at 1.0858 having hit earlier the daily and almost three-year lows at 1.0853.
The number of people applied for unemployment benefits in February rose slightly. Initial jobless claims increased by 2,000 to 205,000 in the week ended February 8. The previous reading was at 203,000, while the forecasts were at 210,000.
The Bureau of Labor Statistics reported, the CPI for All Urban Consumers (CPI-U) that rose 0.1% in January on an adjusted basis, after rising 0.2% in December. In the last 12 months, the all items index increased 2.5% before seasonal adjustment. The US Core CPI yearly reading came in at 2.3% (above the forecasts of 2.2%, the previous reading was at 2.3%.
EURUSD is 0.18% lower approaching the dialy low after the CPI and initial jobless claims. Selling pressure has accelerated after the pair broke below the 100-day moving average. From that point the euro is negative in eight out of the last nine trading sessions. The EURUSD outlook is clearly bearish and only a break above 1.10 might cancel that trend.
On the downside, first support for EURUSD stands at 1.0851 the daily low. We have to go back in 2017 to determine the next target, which stands at 1.0819 the low from April 17th. The pair might make a move to close the gap between 1.0774-1.0819 from April 21, 2017.
On the other side, the initial resistance for the pair stands at 1.0888 the daily high. A break above that resistance will attract more bulls for an attempt to recapture the 1.0924 the high from February 12th. Next supply zone for EURUSD will be met at 1.0958 the high from February 10th.