EUR/USD rises ahead of minutes from the ECB meeting
EUR/USD is rising after a steep fall yesterday. The pair has risen over 1.05 as the USD falls back and as investors digest the latest hawkish comments from the ECB and ahead of the minutes from the latest meeting.
Eurozone inflation has risen to 7.4% YoY in April, a record high, which combined with hawkish comments from Olli Rehn, Pablo Hernandez de Cos, and Madis Miller is helping the euro recover.
ECB minutes will be closely watched for clues over the timing of the next rate hike. Expectations are building for a July rate rise, and hints towards that could lift EURUSD higher.
US jobless claims are due later and are expected to hold steady at around 200k.
Where next for EUR/USD?
EUR/USD has been forming a series of lower lows and lower highs. The pair rebounded higher off the multi-week falling trendline before running into resistance at 1.0560.
Whilst the RSI has moved out of oversold territory but remains in bearish territory. Sellers will need to break below 1.0350 to continue the bearish trend.
Buyers will look for a move over 1.0560 the weekly high and 20 sma to open the door to 1.0640.
DAX falls as inflation and growth fears rise
The DAX along with its European peers is heading lower, tracking weakness on Wall Street overnight.
US indices plunged after disappointing company quarterly earnings highlighted the impact of surging costs on profits.
Fears of persistently high inflation and slowing global growth continue to weigh on risk sentiment. Central banks have been saying that they will act decisively to tighten monetary policy to rein in soaring prices.
Where next for DAX?
The DAX rebounded from the 10 May low at 13250, retaking the 50 sma before running into resistance at 14280.
The move above the falling trendline and 50 sma was short-lived and the RSI is neutral.
Sellers will look for a move below 13530 the April low to attack 13280 and create a lower low.
On the flip side, buyers need to retake 14080 the falling trendline and 50 sma to open the door to 14280 and create a higher high and expose the 100 sma at 14630.
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