The EUR/USD pair edged lower on Wednesday, surrendering earlier gains as the U.S. Dollar shrugged off softer-than-expected Consumer Price Index data. At the time of writing, the pair was trading near 1.1521 after peaking at an intraday high of 1.1563.
The Greenback initially weakened after the inflation report showed headline and core CPI easing to 3.4% and 2.5%, respectively, prompting traders to trim Federal Reserve rate-hike expectations. However, the Dollar subsequently pared losses as persistent energy prices kept upside inflation risks alive. Geopolitical tensions in the Middle East and the reopening of the Strait of Hormuz further bolstered safe-haven demand for the U.S. currency.
The U.S. Dollar Index (DXY), which measures the Greenback against a basket of six major peers, hovered near the 100.00 psychological level after rebounding from an intraday low of 99.61. The Dollar’s recovery pulled EUR/USD toward the lower end of its recent range, following repeated failures to clear the 100-day Simple Moving Average (SMA).
Technical Analysis
On the daily chart, EUR/USD maintains a neutral-to-slightly bullish bias. The pair continues to hold above the 1.1500 psychological threshold and the 50-day SMA at 1.1466.
The Relative Strength Index (RSI) sits near 56, while the Moving Average Convergence Divergence (MACD) remains in positive territory, though a fading green histogram signals waning bullish momentum. The Average Directional Index (ADX) in the high 20s indicates moderate trend strength.
On the upside, the 100-day SMA at 1.1567 presents immediate resistance. A decisive break above this level would shift focus to the 200-day SMA near 1.1630. To the downside, initial support lies at the 1.1500 horizontal level, followed by the 50-day SMA at 1.1466. A breach of the latter would undermine the nascent positive tone and open the door for a deeper pullback.
(The technical analysis in this article was assisted by an AI tool.)
