Today’s (GMT 3)
- 12:00 Eurozone: CPI (April)
- 15:30 Canada: CPI (April)
- 17:30 US: EIA weekly petroleum status report
- 21:00 US: minutes from the Fed’s April meeting
By the time of writing, the euro was trading at 1.2240. Buyers pushed the price action up from the channel (3). So now the road to 1.2303 along the line U3 (1) is open for them. The price action is currently hovering at the 157-degree angle line of the Gann fan. This is not a key resistance level, so the single currency could extend gains up to the 180-degree angle (2) at 1.2270.
EURUSD moved higher yesterday on the back of the rising EURGBP cross. As the euro trended higher, sterling consolidated above 1.4175. Today, these two currencies could see a reversal of position. Players should keep a close eye on the dynamics of this cross. The euro strengthened against the pound to 0.8633. When it reaches 0.8640, cable could start strengthening against the dollar faster than the single currency.
Key events to watch for today include the Eurozone CPI and Fed minutes. Traders and investors will likely be sidelined until the minutes come out. The regulator is expected to clarify its monetary policy stance and the inflation positions of FOMC members.
Bottom line: the euro continues to appreciate against the US currency amid rising risk appetite, with additional support from crosses. The demand for risk-sensitive assets increased on expectations that the Fed will not cut stimulus due to transitory inflation spikes. Europe is in the process of lifting pandemic-induced restrictions. The external news flow looks euro-friendly. After the minutes are released, the next target for buyers will be 1.23.