ECB Decision and US CPIs Take Center Stage

INVESTORS AWAIT THE ECB AND THE US INFLATION DATA

The US dollar traded higher against all but one of the other major currencies on Wednesday and during the Asian session Thursday. It gained the most versus GBP, NZD, and EUR, while it underperformed slightly against CHF.

S&P 500 — TECHNICAL OUTLOOK

Although the S&P 500 tried to make its way higher yesterday, still, there wasn’t enough buying power to keep the index in positive territory. The price was very close to its all-time high, at 4244, but instead, we are now seeing the cash index moving lower. That said, we might still class this move as a temporary correction, before another leg of buying, if the price continues to trade somewhere above the short-term tentative upside support line taken from the low of May 19th.

EUR/USD — TECHNICAL OUTLOOK

Yesterday, EUR/USD tried to make its way higher, but after finding resistance near the 1.2218 hurdle, the pair reversed its course and fell back below most of its EMAs on our 4-hour chart. The rate may drift a bit further south, however, we could still class this move as a corrective one, if EUR/USD continues to trade somewhere above the 200 EMA or the short-term tentative upside support line taken from the low of May 5th.

AS FOR THE REST OF TODAY’S EVENTS

Apart from the ECB decision and the US CPIs, we also get the US initial jobless claims for last week, with expectations pointing to a small decline to 370k from 385k.

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