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EUR/USD slips as Fed hike bets cool after US CPI

EUR/USD was around 1.1521 after an intraday high near 1.1563, with the pair holding above the 1.1500 support level as USD demand gets mixed drivers from oil prices and Middle East risk.

Reported · Written up by our desk · Major Pairs

EUR/USD edged lower on Wednesday after earlier gains faded, with the US dollar regaining some ground even as traders scaled back Federal Reserve rate hike expectations following in line US Consumer Price Index data, according to FXStreet.

The newsletter said the US dollar weakened immediately after the inflation report as headline CPI eased to 3.4% and core CPI to 2.5%, but losses were later pared as elevated energy prices kept inflation risks skewed to the upside. It added that limited prospects for peace in the Middle East and the reopening of the Strait of Hormuz also supported safe haven demand for the dollar.

FXStreet noted the US Dollar Index, which is near the 100 level after rebounding from an intraday low of 99.61, pulled EUR/USD toward the lower end of its recent range after repeated rejections at the 100 day Simple Moving Average. On the daily chart, EUR/USD remains neutral to slightly bullish, holding above 1.1500 and the 50 day SMA at 1.1466, while RSI is near 56 and MACD remains positive but with a fading green histogram.

The outlet pointed to 1.1567, the 100 day SMA, as near term resistance, with a break above it potentially bringing the 200 day SMA around 1.1630 into focus. Downside support was cited at 1.1500, followed by 1.1466, where a break would weaken the nascent positive tone and open the door to a deeper pullback.

Latest closeEUR/USD 1.153 ▼0.2%|Dollar index 99.99 ▲0.2%

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