EUR is on watch today due to flash release of CPI data for November from Spain and Germany. Spanish reading was already released at 7:00 am GMT and showed an unexpected deceleration in headline price growth. German reading will be released at 1:00 pm GMT and is expected to show deceleration from 3.8 to 3.5% YoY. However, EUR may see some additional volatility at 9:00 am GMT as CPI data from a number of German states (Hesse, Bavaria, Brandenburg, Saxony and Baden Wuerttemberg) will be released, and they will most likely set market expectations for the data for whole Germany.
Taking a look at EURUSD chart at D1 interval, we can see that moved around 5% higher since lows made at the beginning of October 2023. Pair tested a psychological resistance in the 1.10 area yesterday and bulls failed to break above. EURUSD is trading little changed today with long upper and lower wicks suggesting there is a lot of indecisiveness among investors. Whether the pair breaks above or pulls back from the 1.10 area may depend on German inflation readings later today. In case we see a break above, the near-term resistance to watch can be found in the 1.1065 area. On the other hand, failure to break above 1.10 area may see the pair erase some recent gains and move towards 1.0850 support zone.
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Source: xStation5
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