The Euro (EUR) inched higher against the US Dollar (USD) on Wednesday, increasing the price of EURUSD to more than 1.2250 following some key economic events. The technical bias has turned bullish because of a higher high in the recent upside rally.

EUR/USD Technical Analysis

As of this writing, the pair is being traded near 1.2278. On the upside, a hurdle may be noted around 1.2300 (a short-term horizontal resistance area as well as psychological number) ahead of 1.2376 (a major horizontal resistance) and then 1.2400 (the psychological number). The technical bias shall remain bullish as long as the 1.0839 support area is intact.

On the downside, a support can be noted around 1.2032 (a key horizontal support) ahead of 1.1829 (the low of the last major downside move) and then 1.1600 (the confluence of horizontal support as well as psychological number) as demonstrated in the given above chart.

Germany’s Consumer Prices

Germany’s consumer price inflation accelerated to a five-year high in 2017, final data published by Destatis showed Tuesday. Consumer price inflation climbed to 1.8 percent in 2017 from 0.5 percent a year ago. This was the highest rate since 2012. Between 2014 and 2016, the inflation rates were even below 1 percent each. The corresponding harmonized inflation figure surged to 1.7 percent from 0.4 percent.

The marked increase in CPI inflation in 2017 was mainly due to energy prices. Energy prices increased 3.1 percent in 2017 after they had declined in the previous three years.

Inflation, based on the harmonized index of consumer prices, which is calculated for European purposes, slowed to 1.6 percent from 1.8 percent in November. On month, the HICP gained 0.8 percent. The statistical office confirmed the provisional estimate published on December 29.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair around current levels may be a good strategy in short to medium term.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips (additional fees may apply). Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.