Title: EURUSD Price oscillates above 1.0100, ECB rate hike in focus
July 18, 2022 12:41 AM ET
In Asian trading, the EURUSD is trading in a narrow range of 1.0100-1.0114. The pair is moving sharply higher amid a sell-off in the US Dollar Index (DXY). The asset posted a bullish opening price after receiving significant buying offers from market participants. The major has comfortably established itself above Friday's high of 1.0098 and is expected to extend its gains.
Meanwhile, the DXY is easing sharply following the bearish trend observed on Friday. At press time, the DXY was at 107.77, showing a vertical downward movement after giving up the critical support of 108.00.
The continued slaughter of the asset after it failed to hold above the crucial resistance of 109.00 has put the asset on a negative trajectory. Going forward, the asset could find a cushion around 107.50.
The EURUSD is targeted higher as positive US retail sales are the result of rising price pressures in the US economy. On Friday, US retail sales came in at 1%, much higher than the previous release of -0.3% and expectations of 0.8%. Expensive fossil fuels and food have led to a strong increase in US retail sales. This has supported the upward trend of the common currency against the greenback. In terms of quality, price pressures on oil and food cannot offset positive retail sales.
A general decline in consumer confidence, as price pressures have affected payrolls, points to a gloomy outlook. This could further accelerate the EURUSD exchange rate going forward. There is no denying that consumer confidence in the US economy has declined significantly. The US Michigan Consumer Sentiment Index (CSI) landed at 51.1, slightly above estimates of 49.9 and the previous release of 50. The reading is well below the lowest level in the last two years.