The Euro extended recovery above 1.19 handle as dollar fell after US inflation miss on Thursday.
US CPI rose 0.2% in April, undershooting forecast at 0.3% while core CPI also fell below expectations (2.1% in Apr vs 2.2% f/c) which could have negative impact on Fed’s interest rate path in 2018.
Profit-taking after steep fall also helped recovery as Wednesday’s Doji and today’s fresh acceleration higher are forming reversal pattern on daily chart.
Fresh acceleration higher needs lift above broken Fibo support at 1.1936 for bullish signal and close above falling 10SMA (1.1965) for confirmation of reversal to open way for stronger correction and expose next key barriers at 1.2017 (200SMA) and 1.2043 (Fibo 38.2% of 1.2400/1.1822 downleg).
North-heading momentum and daily RSI / slow stochastic emerging from oversold zone, support the notion.
Res: 1.1936; 1.1965; 1.2017; 1.2043
Sup: 1.1871; 1.1843; 1.1822; 1.1790
