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The EUR/USD currency pair will begin the new week by trading near the 1.08985 level tomorrow after attaining a high around the 1.09745 mark earlier last week. Important jobs data came from the U.S. last week, but its statistics on Friday came in close to expectations, and Forex trading conditions proved to be thin due to market holidays.

The start of this week will also likely see rather light trading, but speculators should expect more volume to start to trickle into the market on Tuesday, and the EUR/USD pair will likely react with some volatility.

The ability to reach a high early last week, which has not been seen since early February, remains enticing for day traders, who are optimistic about bullish technical charts that show a rather pronounced move upwards for the EUR/USD pair.

Certainly, there have been reversals lower during the drive higher, but prevailing behavioral sentiment seemingly continues to bet on a stronger EUR/USD. Storm clouds are still hovering and nervous results could still erupt, but day traders may find betting on more upside with the EUR/USD pair attractive.

EUR/USD Will Be Hit with U.S Inflation Data This Coming Week

The U.S. will publish its CPI and PPI reports in the middle of the week. The inflation reports via the Consumer Price Index and Producer Price Index will be delivered on Wednesday and Thursday. The U.S. Federal Reserve is still thought to be in a position where it might raise interest rates in early May by 0.25%, but many financial institutions have priced in a less aggressive U.S. central bank stance to develop over the mid-term.

The reversal lower in the EUR/USD pair to close out the week was pronounced, but the selling was not violent. While the Non-Farm Employment Change numbers came in slightly better than anticipated, trading in the pair remained rather calm. Tomorrow’s trading will give another chance to react to last week’s data, but many traders will also start to focus on the U.S. inflation data set to come in later in the week.

The EUR/USD Was Not Able to Sustain the 1.09000 Value and it Remains Important

The inability of the currency pair to stay above the 1.09000 level may make bullish EUR/USD traders nervous, but this may also present opportunities. The pair did manage to climb firmly above the ratio early last week, but the selloff occurring afterwards was noticeable.

The question is if the EUR/USD selloff happened because financial houses wanted to be more conservative regarding their buying before the Good Friday and Easter holidays took place, which seems like a plausible possibility. Tomorrow’s opening in the pair should be watched by day traders, and perhaps into early Tuesday, speculators may want to remain on the sidelines and see where the currency pair traverses.

• The U.S. will also release Retail Sales and Consumer Sentiment numbers on Friday.
• These numbers will show where the U.S. economy is regarding consumer spending.
• Weaker retail numbers from the U.S. could cause spark more buying of the EUR/USD.

EUR/USD Weekly Outlook

The speculative price range for EUR/USD is 1.08190 to 1.10210.

Technical traders who take more than a one-day or weekly approach to their outlooks regarding long-term perceptions clearly have a bullish trend to gaze at regarding the results of the EUR/USD since the end of September 2022. However, day traders must always be prepared for the currency pair to reverse lower, because the daily gyrations of the pair are fueled by behavioral sentiment generated from economic data and market conditions.

Support levels near the 1.08400 to 1.08200 range should be watched this week; if they prove durable, this could spark additional bullish reactions. A fall below 1.08200 could certainly occur, but it would probably have to be triggered by higher-than-expected inflation in the U.S.

If CPI and PPI reports come in with weaker-than-anticipated results, this could fuel additional movement in the EUR/USD pair higher. A retest of last week’s highs could quickly escalate into targeted trading near the 1.10000 level if behavioral sentiment remains optimistic in the marketplace.

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