The EUR/USD pair has been on a winning streak for three consecutive days. At the time of writing, the pair was trading 0.30% higher at $1.1828.
European Inflation Outlook
According to data published by Eurostat, the Euro area annual Consumer Price Index (CPI) is expected to be 3.0% in August 2021. The annual inflation is expected to increase from 2.2% in July according to a flash estimate by the Statistical Office of the European Union.
The energy sector is expected to be the biggest booster in the Euro area inflation. Energy is expected to have the highest annual rate in August, rising 15.4%. Non-industrial goods are expected to advance 2.7% compared to the 0.7% increase in July. Food, alcohol, and tobacco are expected to come in 2.0% higher, while services is expected to increase 1.1%.
EUR/USD will react to the US Consumer Board (CB) Consumer Confidence for August. Analysts expect the US Consumer Confidence for August to decline to 124, down from 129.1 in the previous month. The pair will also react to the ISM Manufacturing PMI later on Wednesday. The ADP Nonfarm Employment Change for August is also due later on Wednesday.
EUR/USD Technical Analysis
The daily chart indicates that the EUR/USD pair has been on an upward trend for the past week. Along the way, it has formed a descending channel which is usually a bullish indicator. It hit an intraday high of $1.1795 before bouncing back.
The currency pair is trading slightly below the 25 and 50-day exponential moving averages. It is also trading below the 50-day moving average.
Therefore the currency pair is likely to edge slightly lower before jumping back on track. If this happens, the bulls will be targeting the key resistance level at $1.19480. On the flip side, a move below the support at $1.1700 will invalidate this vie