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EURUSD Outlook

Yesterday EURUSD was consolidating within a symmetrical triangle which suggests that pair could breakout in any direction. The pair broke out from the resistance trend line of the triangle and went up to find resistance at 1.3946 after the US Empire State Manufacturing Index came out weaker which gave support to EUR. However the upbeat US Industrial Production data capped the gains of EURUSD due to which the pair fell from the resistance 1.3946. The decline in pair extended by the German ZEW Economic Sentiment which reported that the index of German economic sentiment fell to 46.6 in March from February’s reading of 55.7. Economists were expecting the reading to decline to 53. However the assessment of the current economic situation for Germany has improved by 1.3 points in March reaching level 51.3. Economic expectations for the Eurozone have lost some ground.

 After the decline the pair again found support at 1.3893 and surged on the expectation that the US Dollar will decline because of slowing CPI and as it dampens the interest rate outlook for the world’s economy. However better would be to wait for the US CPI data which is coming out at 8:30 AM EDT.