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16.09.2022 08:09 AM
Hot forecast for EUR/USD on 16.09.2022

The market actually takes no notice of any macroeconomic data. Yesterday, the market gave a muted response to US retail sales and industrial production. The readings were better than expected, though both reports indicated some decline. Retail sales contracted to 9.1% from 10.1% whereas analysts had projected a decline to 9.0%. The US industrial production was expected to slow down to 3.5% from 3.8%. In fact, the actual reading fell to 3.7%. Nevertheless, no response followed from investors. No wonder. Investors are nowadays keeping close tabs on the monetary policies of major central banks. The most accurate criterion for further policy moves is inflation. The EU will release its inflation data later today. Market participants will get to know the revised CPI for August which is likely to match the preliminary data that has been already priced in. The CPI is expected to accelerate to 9.1% from 8.9%. So, this will hardly influence market sentiment. The market will perk up only in case the final data differs from the flash estimate.

EUR CPI, y/y

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EUR/USD has been hovering along the parity level for the second day in a row. The price has got stuck in a range from 0.9955 to 1.0020 for a short while.

The H1 RSI technical instrument confirms the flat market by moving along the level of 50. Both the H4 and D1 RSI are moving in the indicator's lower part of 30/50 which corresponds to the overall trend direction.

Moving averages on the H1 Alligator are intersected. The signal is fragile which also corresponds to the flat market.

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Outlook and trading tips

Under such market conditions, the currency pair is accumulating some momentum which will eventually push the price in a particular direction. The reasonable trading strategy is a breakthrough strategy based on a breach of any border of a range between 0.9955 and 1.0020.

It will make sense to consider buy signals in case the price settles above 1.0030 on the 4-hour chart.

A sell signal will come into play once the price settles below 0.9950. This move could update a low of the downtrend.

Complex indicator analysis suggests a mixed signal for the short term and intraday amid the ongoing flat market. Technical instruments signal selling for the medium term as they suppose the overall bearish trend.

Dean Leo,
Analytical expert of InstaForex
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