EUR/USD Dips Below 1.1400, GDP & Inflation Data Fail to Extend Support
After a sudden spike through 1.1400 strong resistance, the EUR/USD
pair pared gains and dropped to 1.1370 before recovering a bit to
1.1385 after the release of better-than-expected Euro-zone GDP data.
The recovery, however, was muted as Euro-zone CPI data showed inflation slipping further into negative territory. Data released on Friday showed Euro-zone inflation dropped 0.2% y/y, as compared to 0.0% in March and consensus estimates of -0.1%. Meanwhile, the GDP data for the first quarter of 2016 came-in better-than-expected at 0.6%, up from 0.3% recorded in the previous quarter and higher than 0.4% forecast.
Technical levels to watch
The pair is reversing from an important resistance and any subsequent weakness below weakness back below 1.1360-50 support might take the pair towards 1.1330 support, marked by a short-term ascending trend-channel formation support level. Only a decisive break below the trend-channel support would negate prospects of any further up-move for the pair.
Alternatively, a move back above 1.1400 handle, providing the break-out momentum to decisively lift the pair beyond the trend-channel resistance (1.1410-15), seems to accelerate the gains towards April high resistance near 1.1460-65 area.