If today’s publication of US inflation figures disappoints investors, it will provoke a new wave of dollar sales.
At the same time, the inflation rate remains 4 times higher than the Fed’s target level, and this forces the US central bank leaders to still adhere to a tough approach in setting monetary policy parameters.
Therefore (and also on the eve of the long weekend – on Friday the US celebrates a national holiday, banks and stock exchanges will be closed) a strong report from the Bureau of Labor Statistics will strengthen the position of buyers of the dollar. As for its main competitor in the foreign exchange market, in this case it will fall sharply against the dollar, putting an end to the upward correction provoked by the controversial report of the US Department of Labor last Friday.
Another important obstacle on the way of EUR/USD decline and return of the pair to a long-term bearish trend lies at the support level 0.9898. Its breakdown will confirm the resumption of short positions.
Below the key resistance levels of 1.0210, 1.0390 EUR/USD is in the zone of a long-term bear market, which means that the advantage is still on the side of the sellers.
*) for the most important events of the week, see the Most important economic events of the week 07.11.2022 – 13.11.2022
Support levels: 0.9953, 0.9930, 0.9898, 0.9800, 0.9745, 0.9700, 0.9600, 0.9535, 0.9500, 0.9400, 0.9300, 0.9200, 0.9000
Resistance levels: 1.0000, 1.0090, 1.0100, 1.0210, 1.0390, 1.0500