Euro (EUR) inched higher against the US Dollar (USD) on Tuesday, increasing the price of EURUSD pair to more than 1.1900. Tuesday was the sixth consecutive day when the EURUSD pair registered bullish momentum. The pair is currently testing some critical resistance levels ahead of the Eurozone’s Consumer Price Index (CPI) data which is due later today (Wednesday).
As of this writing, the EURUSD pair is being traded around 1.1932. Immediate resistance is being noted near 1.2000 (the psychological level) ahead of 1.2024, the trendline resistance on the daily timeframe. A breakout above the 1.2024 resistance shall open doors for another upside move towards the 1.2300 level in the long run.
On the downside, the pair is likely to find immediate support around 1.1861 (the low of yesterday) ahead of 1.1800 that is confluence support of both lower trendline as well as psychological level. A bearish breakout below 1.1800 shall turn our EURUSD bias into the bearish trend for short to medium term.
Eurostat, the statistics body of the Eurozone, is scheduled to release the Consumer Price Index (CPI) data today (Wednesday). CPI is considered to be a key gauge for inflation across the Eurozone. According to the median projection of economists, the CPI is likely to register a 0.3% decline for July as compared to a 0.3% increase in the month before. Generally speaking, a higher positive reading of CPI is considered bullish for EURUSD and vice versa.
Considering the overall technical and fundamental outlook, buying the EURUSD on dips (near the above-mentioned support levels) appears to be a good strategy. Alternatively, selling EURUSD below 1.1800 could also be a good option.