The EUR/USD pair was trading in the red at 1.0318 at the time of writing and it seems heavy in the short term as the Dollar Index is fighting hard to rebound. Technically, the currency pair reached a strong upside resistance, so the current sell-off is understandable.
The rate dropped even if the US PPI dropped by 0.5% versus a 0.2% growth expected, while the Core PPI reported a 0.2% growth compared to the 0.4% forecasted. In addition, the Unemployment Claims indicator was reported at 261K in the previous week versus 264K in the last reporting period. Tomorrow, the Prelim UoM Consumer Sentiment is seen as a high-impact event and it's expected at 52.5 points versus 51.5 in the previous reporting period.
EUR/USD Still Bullish!
You knew from my previous analysis that the price could find support around the weekly R1 (1.0280) and that yesterday's sell-off could be only a temporary one. Today, it has rebounded but it has found resistance at 1.0353 again.
Now, it has retreated and it could reach and retest the 1.0300 psychological level. As long as it's traded above the R1, the EUR/USD pair could still try to resume its leg higher.
EUR/USD Outlook!
As you already know, a larger upside movement and a new long opportunity could be confirmed only by a valid breakout above 1.0353 and through the R2 (1.0370).
