Can the CPI Release Reverse The USD? 

Can the CPI Release Reverse The USD? 

Diperbarui • 2023-09-13

The upcoming August inflation data may send mixed signals. The 12-month headline inflation rate is expected to rise to 3.6%, causing concerns for the Biden administration. However, core inflation, which excludes food and energy prices, is projected to decrease to 4.3%, aligning with the Federal Reserve's goals. Past price trends influence both figures, so looking at recent data for a more accurate picture is crucial. In this context, the headline number may show a significant 0.6% increase, driven by higher energy prices. Meanwhile, core inflation is expected to grow steadily by 0.2%, indicating a gradual moderation of inflation.

US Dollar - H4 Timeframe

UsDollarH4-1209.png

Currently, the 4-hour timeframe of the US dollar index shows the price reacting away from a pivot zone on the Daily timeframe. Considering that the US Dollar's momentum seems to have slowed down considerably over the past few days, it seems quite clear that the price intends to reverse and go bearish for a while from the current area.

Analyst’s Expectations: 

Direction: Bearish

Target: 103.751

Invalidation: 105.142

EURUSD - H4 Timeframe

EURUSDH4-1209.png

EURUSD, at the moment, may be heading bullish. The current price action is a rejection from a demand zone on the daily timeframe, which has already given off a change-of-character on the 4-hour timeframe. On this basis, my sentiment is bullish unless the price trails below the current lower prior to the release of the CPI data.

Analyst’s Expectations: 

Direction: Bullish

Target: 1.07808

Invalidation: 1.06835

GBPUSD - D1 Timeframe

GBPUSDDaily-1209.png

The Daily timeframe of GBPUSD presents the clearest argument for a bullish move I’ve seen so far. Here, we see the 200-period moving average support, the drop-base-rally demand order block, as well as a bullish array of the moving averages, pointing clearly to the likelihood of a bullish impulse from the demand zone. As always, before taking any trades, I will wait for an entry trigger from the lower timeframes.

Analyst’s Expectations: 

Direction: Bullish

Target: 1.26097

Invalidation: 1.24417

CONCLUSION

The trading of CFDs comes at a risk. Thus, to succeed, you have to manage risks properly. To avoid costly mistakes while you look to trade these opportunities, be sure to do your due diligence and manage your risk appropriately.

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