Analyzing EUR/USD, GBP/USD, and USD/JPY Ahead of Key US CPI Release

In this week’s forex market update, attention is drawn to major currency pairs, including EUR/USD, GBP/USD, and USD/JPY, as traders anticipate the upcoming release of the US Consumer Price Index (CPI) on Wednesday, April 10, 2024. Market consensus expects an increase to 3.4% from the previous 3.2%, making this data a potential market-moving event that could influence the direction of these currency pairs.

EUR/USD: A Phase of Cautious Consolidation

The EUR/USD pair is currently trading at 1.08553, with a slight decrease of 0.03%. Over the past week, the pair has gained 0.76%, despite a monthly decrease of 0.84%, indicating a mixed sentiment in the market. Technical indicators suggest a phase of consolidation, with traders advised to watch for a breakout above 1.08635 for bullish signals or a breakdown below 1.08539 for bearish cues. The upcoming US CPI release could significantly impact the pair’s direction.

GBP/USD: A Balance Between Bullish and Bearish Forces

The GBP/USD exchange rate stands at 1.26546, showing minimal change. The pair has seen a gain of 0.60% over the past five days, despite a monthly decline of 1.20%. Technical analysis indicates a balance between bullish and bearish sentiments, with the pair in a consolidation phase. Potential movements in either direction could be based on upcoming economic data, with key levels to watch including the recent trading range between 1.26428 and 1.26617 USD.

USD/JPY: A Steady Climb Amidst Market Fluctuations

The USD/JPY exchange rate is 151.854, indicating a slight increase of 0.05%. The pair has demonstrated a consistent upward trend, with a notable year-to-date increase of 7.81% and a yearly rise of 14.97%. While short-term analysis presents a mixed view, the overall trend suggests a bias towards strengthening, primarily driven by the interest rate differential between the U.S. and Japan. Traders should remain alert for any sudden policy changes or interventions by the Bank of Japan.

Looking Ahead: Key Levels and Market Sentiment

As the release of the US CPI data approaches, traders should closely monitor key levels and market sentiment for each currency pair. For EUR/USD, the focus is on the 1.08539 to 1.08635 range. GBP/USD traders should watch the 1.26428 to 1.26617 range, while USD/JPY traders should keep an eye on short-term volatility and potential resistance levels.

In conclusion, the forex market is set for another week of potential volatility, with the US CPI release as a key event to watch. Traders should conduct thorough research, consider their trading strategy, and manage risk carefully before entering the market.