For last 24 hours, the situation in the main FX pair EUR / USD practically has not changed. The pair continued to consolidate in a narrow range, which is the balance level of the wide sideway channel $1.2180-$1.2515. At the same time, in European trading session, the pair not only managed to hold on to these levels, but even demonstrated an intense upward surge in the $ 1.2385 zone after the most important and expected data on US inflation appeared.
According to statistics, consumer price growth in the US slowed in February on the back of a decline in gasoline prices and a moderate rental price, which indicates that the expected inflation growth is likely to be gradual. US consumer price index in January rose by 0.2 percent after it rose 0.5 percent in January. In the 12 months to February, the consumer price index rose by 2.2 percent, compared with 2.1 percent in January.
The figures came out well below the general expectations, and show that inflationary pressure in the US is not growing as fast as the American regulator would like. Of course, these figures are unlikely to change the Fed's plans for the next meeting, the probability of a rate hike on March 21-22 is now close to 100%, but how will US regulator proceed in 2018 with such inflation? Recall that the markets expect four rate increases in 2018. Interesting situation.. In any case, after the data, US markets opened in the green, and the US dollar came under increased pressure.
For EUR / USD this means improved growth prospects. If the current support of 1.2300-1.2340 stands well, then the chances of re-testing the upper boundary of the channel will increase substantially.
Our recommendations - purchases from the support zone 1.2300-1.2340