FOREX NEWS: EURO IN CONSOLIDATION PATTERN, POUND REACHES NEW HIGHS. ECONOMIC DATA DECIDES DIRECTIONEUR/USD
Forex News: The pair didnít travel a substantial distance during yesterdayís trading session and 1.3560 resistance was re-visited. Euro Zoneís CPI came out with the anticipated value and the release didnít create a lot of volatility.Technical Outlook
The pair is in a consolidation zone between1.3585 and 1.3520 and a breakout is imminent. The medium term trend is bearish so thereís a higher probability of a break of support than of resistance. If 1.3520 is broken, the next important level is located at 1.3500 followed by 1.3480 while to the upside price will encounter resistance at 1.3650 if 1.3585 will be broken.Fundamental Outlook
An important German survey is released today at 9:00 am GMT: the ZEW Economic Sentiment. This indicator is based on the opinions of about 275 German professional investors and analysts who are asked to rate the current and future economic conditions. The forecast is an increase from 33.1 to 35.2, a fact which would strengthen the Euro and drive the pair higher.
At 12:30 pm GMT the American Consumer Price Index is announced and expected to decrease from 0.3% to 0.2%, a fact which would be detrimental for the US Dollar since the CPI acts as the main gauge of inflation.GBP/USD
The Pound continued to climb, fueled by speculation about a potential rate hike performed by the BoE and 1.7000 was breached as a result.Technical Outlook
Immediately after piercing the multi-year top created at 1.6996, the pair returned below it, a fact which shows that resistance is still holding and it will take more than one attempt to break it. Also, the Relative Strength Index is starting to descend towards the 70 level, coming from overbought territory, a fact which favors the bears and increases the chance of a touch of 1.6920.Fundamental Outlook
Price direction will be influenced today by the release of United Kingdomís CPI which is scheduled at 8:30 am GMT. Inflation is anticipated to drop from the previous 1.8% to 1.7% and if analystsí expectations come true or even lower numbers are posted, the Pound is likely to lose some steam. As always, the US events will have a direct impact on the pairís direction.