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12.12.202207:27 Forex Analysis & Reviews: EUR/USD: Breaking forecast on December 12, 2022

Producer prices in the United States came in line with market expectations. In fact, the previous reading was upwardly revised to 8.1% versus 8.0%. Meanwhile, annual producer price inflation eased to 7.3% from 7.4%. In other words, inflation is likely to go down slower than it should, which means the US Fed may raise the interest rate by 75 basis points on Wednesday. In this light, the euro edged down. Anyway, US inflation keeps falling, meaning there is still a likelihood, although smaller, of a reduction in the pace of interest rates already this year. The shift in expectations is seen as the reason behind a fall in the euro.

United States Producer Price Index:

Exchange Rates 12.12.2022 analysis

The euro is seen to be trading under the influence of the pound today. Indeed, the macroeconomic calendar will mostly be empty with the UK's industrial production being the only important report published during the day. In fact, a slump in industrial production in the country may somewhat slow, thus boosting the pound. Meanwhile, the euro will follow suit.

The euro/dollar pair approached the area of 1.0580/1.0600, and buying volumes decreased. Consequently, the price rebounded and returned to 1.0500.

The RSI crossed line 50 to the downside on the 4-hour chart. The indicator is still moving near the middle line, signaling market uncertainty.

The Alligator has not produced a clear signal on the 4-hour chart yet. Its moving averages (MA) are intertwined. On the daily chart, the Alligator's MAs are headed up, in line with the current uptrend.

Exchange Rates 12.12.2022 analysis

Outlook

The price may get stuck between the key levels of 1.0500 and 1.0600. This move may lead to an accumulation stage in this range.

Based on complex indicator analysis, there is a sell signal for short-term and intraday trading as the quote has returned to 1.0500. In the medium term, indicators signal an uptrend.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Dean Leo,
Analytical expert of InstaSpot
© 2007-2026
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