The market reacts directly to the release of inflation data from the United States (US) which is the main focus this week.
The annual reading of the consumer price index (US) for March slowed to 5.0%, lower than the expected 5.1%, maintaining a downward pattern in the inflation rate for 9 consecutive months.
Down from the previous month's rate of 6%, this latest inflation level is the lowest recorded since May 2021.
Thus, the US dollar continues to show a significant depreciation effect as soon as the data is published sparking the idea that the Federal Reserve (Fed) will slow down their monetary policy tightening.
The price chart of the EUR/USD currency pair showed a jump of around 80 pips in the New York session yesterday, recording the latest high level again surpassing last week.
The price was initially flat around 1.09300 then surged to reach the target level of 1.10000 as expected by analysts.
Prices are seen starting to slow down around that until continuing in the Asian session this morning (Thursday) making it the latest resistance level.
With the bullish signal of the price movement still above the support level of the Moving Average 50 (MA50) on the 1-hour time frame on the EUR/USD chart, expect a higher rise to continue today beyond 1.1000.
Therefore, the latest high level will be recorded again with the next price target being around 1.12000.
However, if the price is pushed back down from the 1.1000 level, the 1.09000 zone will be the first to be tested before the price continues its decline towards support at 1.08000.
