How To Trade The US Inflation Data With EUR/USD

• The US inflation report report is critical for the Federal Reserve and for the US Dollar.
• The Market Impact Tool shows trading opportunities in both upside and downside surprises on this event.

Selling EUR/USD Scenario

• Tradable Positive Trigger: +1,12 deviation [SELL Pair]
• Key Support Level: 1.2340

If it comes out at higher than expected with a deviation of +1,12 or higher, the pair may go down reaching a range of 39 pips in the first 15 minutes and 88 pips in the following 4 hours. 

Support is at $1.2340, where a swing high from late April meets the 50-day Simple Moving Average. Further down, $1.2240 served as support in March and $1.2210 worked as such in early April.

Buying EUR/USD Scenario

• Tradable Negative Trigger: -1,25 deviation [BUY Pair]
• Key Resistance Level: 1.2412

If it comes out lower than expected at a deviation of -1,25 or less, the EUR/USD may go up reaching a range of 24 pips in the first 15 minutes and 76 pips in the following 4 hours.

Resistance awaits at $1.2412, a high seen on March 13th. Further above, $1.2480 was the swing high on March 27th. The pair faces further resistance at $1.2555, the three-year high.

EUR/USD Levels on the Chart

More data

In the last five releases, the EUR/USD moved, on average, 38 pips in the 15 minutes after the release and 70 pips in the 4 hours after the release.

The previous release had no surprise measured in terms of deviation.

The US inflation report is expected to show a rise in inflation: 2.1 percent on Core CPI against 1.8 percent last time as base effects such as wireless charges are removed. 

See: What to expect from US inflation and EUR/USD

Follow the publication of the figure on the economic calendar. Watch out for the data from the Market Impact tool, projecting the potential price changes according to the deviation. Here is the Market Impact Studies Users Guide.