- – The Euro remained under heavy pressure this week and traded below 1.0600 against the US Dollar.
- – There is a clear descending channel pattern formed on the 4-hours chart of EUR/USD with resistance at 1.0600.
- – In the Euro Zone, the Spanish Consumer Price Index released by the National Institute of Statistics posted a decline of 0.5% in Jan 2017 (MoM).
Spanish Consumer Price Index
Today in the Euro Zone, the Consumer Price Index for Jan 2017 was released by the National Institute of Statistics. The market was aligned for the retail prices of a representative shopping basket of goods and services to decline by 0.5% in Jan 2017, compared with the previous quarter.
The result was as expected, as the Spanish CPI declined 0.5%. In terms of the yearly change, there was a rise of 3% in Jan 2017, compared with Jan 2016. The report added that the Transport Cost rate was 7.6%, almost three points above the December, caused by the increase in the prices of the Fuels this month, against the descent in January 2016.
Overall, there is hardly anything to cheer for the Euro buyers, which may put further pressure on the EUR/USD and take it lower towards 1.0500.
EUR/USD Technical Analysis
The Euro traded sharply lower this week against the US Dollar, and broke the 1.0640 and 1.0600 support levels. The EUR/USD pair is currently following a consistent downtrend, as there is a descending channel pattern formed on the 4-hours chart with resistance at 1.0600.
The pair has already broke the 1.236 extension of the last wave from the 1.0619 low to 1.0828 high. So, there are chances of further declines, which could push the pair towards 1.0500.
The pair could even test the 1.618 extension of the last wave from the 1.0619 low to 1.0828 high at 1.0490. The 4-hours RSI is well below the 50 level, which is a bearish sign. On the upside, the channel resistance at the moment is at 1.0600. Only a break and close above 1.0620 might negate the current bearish trend line for EUR/USD. Otherwise, we may continue to see declines in the near term.Tags: EUR/USD Technical Analysis, Euro, US Dollar