- Euro is continued to move down against the US Dollar, and it looks set for more declines.
- Euro Zone CPI released by the Eurostat posted a decline of 0.2% in February 2016, which was worse than the forecast of 0%.
- Italian Consumer Price Index released by the Istat posted a decline of 0.3%, more than the forecast of a 0.1% decline in Feb 2016.
- EURUSD was down and out, and looks set for a move towards the 1.0840 level.
The Euro after a mild correction against the US Dollar towards the 1.0960 level found sellers and started to move down. There was a major support area formed near 1.0910, but sellers even managed to break it to take EURUSD down.
If the EURUSD pair corrects a few pips higher from the current levels, then the broken support area at 1.0910 levels may now act as a resistance and sell area.
On the downside, the next support area can be at 1.0860, followed by 1.0840.
Euro Zone CPI
Today, there was a major release in the Euro Zone. The Euro Zone CPI, which captures the changes in the price of goods and services was released by the Eurostat. The market was positioned for no change in the CPI in Feb 2016, compared with the same month a year ago. However, the preliminary reading calls for a decline of 0.2% in the CPI.
The report highlighted that “In January 2016, negative annual rates were observed in ten Member States. The lowest annual rates were registered in Romania (-1.5%), Cyprus (-1.1%) and Slovenia (-0.8%).”
Overall, there was a lot of pressure on the Euro bulls, which may take the EURUSD pair down in the near term.